How to screen your prospective tenants properly 2013
Landlord’s Legal Center
Franco Simone, Esq.
1660 Hotel Circle North, Suite 610
San Diego, CA 92108
(619) 235-6180 Telephone
(619) 235-6392 Facsimile
The primary goal of the screening process is to find a
desirable tenant, typically a stable occupant who is a
good credit risk and will not damage the premises or
disturb other tenants.
IN OTHER WORDS— TO AVOID BAD TENANTS
WHICH CAN COST YOU $$$$$$$$$$$$
Damage to your unit
Eviction fees and attorney’s fees
Landlord May Use These Factors
Amount (not source) of income
Past bad conduct relevant to reasonable
belief applicant may be direct threat to
health or safety of current
What Steps Should I Take To Screen
Verifying Information on Rental
GOAL OF RENTAL APPLICATION
Is to obtain information about an Applicant to determine if that
person will be a stable, responsible individual who will have the
ability to pay the rent. (See Form #1-Rental Application)
The application should contain the applicant's express written
authorization for the landlord
1) to contact all persons or firms named as references,
former landlords, or employers;
2) to verify the contents of the application, including
obtaining a credit report on the applicant;
3) A written application must be signed by the applicant
before a landlord can obtain a credit check.
Written Rental Applications
What NOT to Ask:
It is illegal for the Landlord to ask Tenant questions
about race, color, religion, sex, sexual orientation,
marital status, national origin, ancestry, familial
status, source of income, disability, age, medical
condition, victim of domestic violence or whether you
have persons under the age of 18 living in your
LL can’t ask about immigration or citizenship
LL can’t discriminate because of source of income BUT
can ask Tenant’s source of income and the level of income
Tenant asks for an “accommodation”-Proof of Disability
For housing limited to persons of one sex who will share
living areas in a single dwelling unit
LL can limit the number of persons per unit-however…..
RED FLAGS ON APPLICATIONS
Tenant wants to move in quickly
Check ID with name on application-Get copy of ID
Make sure name matches Social Security number
IF employer sounds fishy try calling through separate
telephone number you obtain on your own
Get an application from any one over 18 years of age
Verify Application Information!!!
Contact all persons or firms named as
references, former landlords, or employers
Verify the contents of the application,
including obtaining a credit report on the
BAD EXCUSES NOT TO VERIFY INFO
“They seemed like nice people.”
“I didn’t have time.”
“They were referred to me by a friend/Pastor/family
“I really enjoy the eviction process.”
Income-Pay stubs, 1099s, award letters, call employer
Personal ID-Drivers Lis., Passport, green card
Past residences-Send a letter/Call past Landlords
Pull a Credit Report to compare with the information
on the Application
LL can charge up to $49.50 in an Application fee to
apply to actual out of pocket costs to cover credit
report and checking personal references. (2012)
Three credit bureaus: Equifax, Trans Union and
Who Provides the Credit Report?
Even though you may do so, do
NOT accept the tenant’s copy of
his/her credit report.
Credit Scores-An Overview
The highest possible credit score under the FICO
system is 850.
Any score between 850 and 720 is considered to be
Scores between 719 and 600 still qualify for credit.
Scores between 599-300 high-risk
Fair Credit Reporting Act (FCRA)
What a Landlord Needs To Know:
If you are a LL or management company who uses
“consumer reports” to evaluate rental applications your
need to follow FCRA
FCRA designed to protect the privacy of consumer
reports information and guarantee that the information
What If I Don’t Follow FCRA?
Applicant can sue in Federal court for damages,
attorney’s fees and court costs.
If deliberate…..punitive damages
Federal Trade Commission or the states may sue LL
for non-compliance and get civil penalties.
What is a Consumer Report?
Tenant-Screening Service-rental history
What Actions Are Covered?
Depends on who is verifying the
If by an Agency hired by LL------ COVERED
If by LL’s employees------ NOT COVERED
What is an Adverse Action?
Any action taken by the LL or management
company that is unfavorable to the interests
of a rental applicant is covered by the FCRA
Denying applications, requiring a co-signor
or requiring an additional deposit.
What Does This All Mean?
If you use a consumer report issued
by an agency you hired and that report
causes you to take an adverse action
against a rental applicant the YOU
MUST give the applicant notice that
When is a Notice Required?
Take the Case of……
1. Further investigation
2. Consumer report part of the decision
3. Increase in deposit
4. Using Agency to check employment
What Information Must Be Included In a Notice?
Name, address and telephone number of the Agency
which issued the report.
Statement that the Agency supplied the report did
not make the decision for the adverse action.
A statement that the applicant has a right to obtain,
within 60 days, a free copy of the credit report from
the agency and the right to dispute the accuracy of
the information. See Form 2
Some Legal Protection
If LL inadvertently fails to provide a required Notice
in an isolated case, then LL has some protection from
damages if LL can demonstrate “that at the time of
the…violation he maintained reasonable procedures
to assure compliance” with the FCRA.
Be consistent in the Application Process:
Use same rental application
Always pull a credit report
Always verify the same information
Screen criteria should relate to legitimate LL
No Subjective Criteria-long hair, smells bad
More Final Thoughts