Tenant screening is a crucial part of owning profitable Winston-Salem rental properties. Despite appearances, the process is not always as simple as it may appear. There are lots of different ways in which your screening method could breach federal or local landlord regulations. The purpose of these laws is to prevent discrimination against or for protected classes of renters and to provide habitable shelter. They help protect tenants and prospective renters from the very first conversation. This is why it is essential to make sure that your tenant screening is not only detailed but that it does not overstep the line into discrimination. By resisting discrimination, you not only remove potentially costly lawsuits but also guarantee that your process is fair and by all applicable laws.
Fair Housing Act
The Federal Fair Housing Act (FFHA) is the most important federal anti-discrimination statute for property owners to comprehend. All interactions between tenants and landlords are covered by the act. The FFHA prohibits landlords from refusing to rent to tenants based on their race, sex, religion, family status, or disability, among other factors. The FFHA also forbids landlords from misrepresenting the availability of a rental home or imposing stricter requirements on particular tenants. This includes asking some tenants for a larger security deposit or evicting someone for any reason that wouldn’t lead you to evict another tenant.
Penalties for Discrimination
Violating FFHA can result in severe penalties. For instance, a property owner who is found in violation of the Fair Housing Act may be subject to a maximum civil penalty of $21,663 for the offense. Persons who infringed the Fair Housing Act in the previous five years could be fined up to $54,157, and respondents who breached the Act twice or more in the previous seven years could be charged up to a maximum of $108,315. Make sure that your applicant screening procedure does not discriminate against any applicants just to avoid these penalties.
Strategies for Legal Tenant Screening
To make sure that your tenant screening process is both precise and legal, it is fundamental to have a set of clear guidelines for every interaction with prospective or current tenants.
Clarify Approval Criteria. It’s vital to take safety measures to keep everything FFHA-compliant because tenant screening begins with the very first discussion you have with someone seeking to apply for your rental property. You ought to make it a point to outline your approval standards and expectations during that initial conversation.
Avoid Illegal Questions. Be careful not to ask your tenant any questions during the tenant screening process that might pressure them to reveal protected information. Typically, inquiries into ancestry, race, or national origin are not appropriate during the tenant screening process. The same holds for inquiries about a person’s ability or family situation. Unless the tenant specifically brings them up, such questions shouldn’t be included in your application materials or brought up in conversation.
Examine Your Approval Process. Reviewing your screening process for any possible form of discrimination is also vital. As an illustration, Winston-Salem property managers should ordinarily accept applications and interview potential tenants in the order that they are received. A form of discrimination is to collect applications and then delay them while you wait for someone else to submit theirs. If the applicant has paid the due amount and presented complete application forms, you should begin the screening process. It is reasonable to disqualify an applicant based on predetermined factors, such as a low credit score or poor references. It is not ethical, however, to make an applicant wait for a reply while hoping for someone else to qualify.
Know and Follow the Law. Lastly, every property owner should be aware of the local laws regarding renting to people with a criminal record. It’s crucial to recognize what they are and modify your tenant screening process appropriately because not all criminal offenses are considered good enough grounds to deny someone a rental.
The tenant screening process ought not to be biased against any speciﬁc applicant when you are aware of the local and federal laws that apply to it and you follow them. This will aid you in avoiding any fines or legal action, as well as assist in offering your neighborhood fair housing.
While researching every potential income property is a lot of work, Real Property Management of the Triad can help lighten your load. We offer free rental property analyses for investors, which can help you more easily identify whether the income property you want to buy is a profitable option. Contact us online or call us at 336-355-6677 or 336-777-7444 to learn more!
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.