Use a Lawful Application When Renting to Tenants

Application To Rent

I was recently asked, “What do I do if someone I don’t want to rent to wants to apply?”

Answer: You let them apply. Put simply, this should be your motto: Everyone is welcome to apply.

But wait! Let’s you talk to them on the phone, and they have an obvious problem where you know they won’t pass your screening criteria. Wouldn’t doing a walk through or accepting their application be a waste of time and misleading to them?!

Been there. I once talked to someone who had a recent criminal offense (it was bad, and relevant). I knew if it was half true they wouldn’t pass my screening criteria. At this point in the conversation I switch my tone of voice to empathetic and let them know, “I can’t make any decisions until I verify everything on the application, but this doesn’t sound like something that would pass our screening criteria.” Usually people get what I’m saying.

But this person did not. This person took that as an invitation to apply and asked for an application.

I was, in all honesty, shocked. I tried my line again, “Of course. Everyone is welcome to apply. But again, this doesn’t sound like something that would pass our screening criteria.”

Want to know what happened?

This person took an application, turned it in, and paid the screening fee in cash ($35 x 2!). I accepted the application and ran through the normal screening process.

There’s no surprise twist ending here: They didn’t pass. I gave them a simple letter officially stating they were declined and why. I even returned their screening fee and took the $70 loss.

 

Why Should You Let Everyone Apply?

By systematically offering an application to everyone you’ll avoid any discrimination issues. Under the Fair Housing Act, it’s illegal “To discriminate against any person in the terms, conditions, or privileges of sale or rental of a dwelling, … because of race, color, religion, sex, familial status, or national origin.”

By allowing everyone to apply, it’s impossible for anyone to claim you denied them for illegal reasons. Then, once they apply, you can use the S.O.L.I.D. screening criteria to objectively screen them on things only relevant to renting. At this point, everything is documented (what they told you and how you evaluated them). So if there’s ever a question of illegal discrimination, you’re protected.

Is it overkill? Yes, but other landlords didn’t respect people and now we need to take the higher ground and go out of our way to show people we’re being fair and consistent.

 

Items To Include in the Application

You can get the application I use here. You can also create your own here. In general, you want to collect information related to your screening criteria.

  • Name, date of birth, social security number. Names of everyone living there.
  • Where they currently live, any previous places and their landlord’s contact information
  • Explicitly ask if they’ve ever been evicted, convicted of a crime, or if they smoke.
  • Employment: where, how long, how much
  • Pet details

Information you don’t need:

  • Bank account info
  • Anything related to race, color, religion, sex, national origin, disability, or familial status

Every adult, over the age of 18, should fill out an application.

 

Check Each Application Thoroughly in the Order You Receive Them

Some people like to wait until they have a pool of candidates and then choose the “best one”. I’m not a fan of this. What does “best one mean”? They pass your criteria the most? What do you do when two applicants are the same on paper? How long do you keep your rental open before deciding the pool is big enough? It gets complicated fast.

The easiest thing to do is to screen each application in the order you receive them. The first person who qualifies is the person you rent to. It’s easy, fair and systematic.

But what if someone technically passes your screening, but you really don’t want to rent to them? Change your criteria. Clearly it’s not strict enough to make you comfortable. As long as you’re consistent, and it’s not related to any of the protected classes, you can be as strict as you want.

I go a lot more into this topic in this video.

 

Receiving an Application Is the Easy Part

By already pre-screening applicants over the phone, you’ll have a good idea of whether they’re qualified to rent from you. This should make officially applying more of a formality than a fact finding mission. Still, you want to make sure it’s done lawfully and doesn’t accidentally illegally discriminate against anyone. They easiest way to do that is to allow everyone to apply, and then use the S.O.L.I.D. screening criteria to objectively evaluate them in the order they apply.

 

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