As a landlord, one of the most important business decisions that you make will be choosing a tenant. This person will live in your property, and has the power to treat your home well or to damage it and end up costing you a lot of money. A tenant that fails to pay the rent also costs you big time in terms of eviction proceedings. However, you also have a legal responsibility not to unfairly discriminate against tenants. In order to uphold those responsibilities, you need to be familiar with federal fair housing laws and the anti-discrimination regulations of your state. Here’s a guide to the basics of fair housing laws.
Federal Fair Housing Laws
Federal Fair Housing Act: This is the most well-known law regarding discrimination in housing, but it’s not the only law on this topic. The Federal Fair Housing Act bars landlords from discriminating against tenants based on their race, skin color, gender, religion, national origin, disability, or family status. This applies to sale, rental, or financing of housing.
Civil Rights Act Title VI: This act bars discrimination in programs that receive federal financial assistance. Discrimination on the basis of race, skin color, or national origin is prohibited.
Americans with Disabilities Act Title II: This act bars discrimination against persons with disabilities in programs made available by public entities. In relationship to housing, HUD enforces ADA Title II as it relates to public housing, housing assistance, and housing referrals.
Age Discrimination Act: Discrimination based on age is prohibited in federally funded programs.
Some of these laws apply only to landlords who receive federal funding assistance, while the Federal Fair Housing Act applies to everyone.
State Fair Housing Laws
In addition to the Federal Fair Housing Act, there are additional state fair housing laws in nearly every state. These laws tend to be quite similar to the regulations of the Federal Fair Housing Act. However, many states include additional protected groups, such as those based on sexual orientation, political affiliation, or personal appearance. Be sure to familiarize yourself with your state’s specifications before screening tenants.
Financial Credit Reports
Landlords should always run a credit check on prospective tenants before agreeing to rent to them. It is perfectly legal and acceptable to deny rental to an applicant due to a poor credit history. Just remember that you can only reject applicants for housing on sound business grounds, and a credit report provides you with that.
Consistency of Practices
It is also important that you are consistent in your practices. It is illegal to require credit checks only for certain groups of people, and it is illegal to require a larger security deposit for certain groups of people. You cannot prove that you have made a legitimate business decision if your practices are inconsistent from one applicant to another. You must also be consistent when it comes to accepting late rent and charging late fees.
It is not enough that you know the rules about fair housing; your employees and anyone involved in screening tenants must also understand the fair housing regulations thoroughly. Any inconsistent behaviors between employees can look like discrimination.
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