Wednesday, April 29, 2015
Are you aware of the Gramm Leach Bliley Act? You should if you’re a client of Rental Services, Inc. or you access personally identifiable information as part of a resident screening report. We’ve posted a copy of the Gramm Leach Bliley Act on the RSI website and we recommend taking a moment to review the complete document.
Tuesday, January 13, 2015
There are a growing number of online options available to individuals looking for background information. The increasing accessibility of online background screening has fostered the misconception that these checks are easier and cheaper than ever before…and that the information available through an automated platform is of the same quality as that obtained through a qualified credit or background investigator.
We live in a society accustomed to having a wealth of information at our fingertips. The internet is an endless resource for FREE information! However, the plethora of public data does not necessarily make it any easier to generate quality screening information. This is the first problem with online person search products: shockingly poor quality.
Online companies are not able to adequately cross-reference for accuracy. The human element is missing, and in that void lays the essential key to quality screening. An inaccurate address could lead to a complete dead-end, or worse, information on someone who is not actually the person you are searching. There may be a thousand John Smiths with the same birthday. In order to verify that you have the correct information for your John Smith, a multitude of other personal information needs to be cross-referenced. A person who is trained as an investigator is able to determine when there are inaccuracies or missing data. An automated program is not capable of completing the same screening report as a qualified investigator.
Poor quality is not, however, the biggest problem with online sourced background checks. The most concerning issue is, perhaps, the least obvious to the average person. Most people are not aware that you are not legally able to use the information provided through these online companies, and in some cases, not even legally able to search for that information.
FCRA regulations stipulate that only credit reporting agencies should provide information to be used as a determining factor in employment eligibility, tenancy, personal credit, loans or insurance transactions. Online person search sites such as PeopleFinder.com, Intelius.com, and InstantCheckmate.com are not credit reporting agencies and are not, therefore, providing background information that can be used as a determining factor in any of the above circumstances.
Furthermore, it is important to be aware that federal, state and local statues govern the regulations and licensure required to conduct background screening. Online background companies have waivers stating that you are responsible for following these regulations and not requesting any information that would be illegal to obtain without the required license or authorization. This means that depending upon where you are located, and where the individual you are searching resides, you may be breaking the law by accessing background information even though it is available to you for purchase through this online companies.
After close examination of background screening options, the choice is easy. You can pay for bad information, you can be liable for obtaining, and are not legally able to use…or you can hire a qualified investigation company and obtain high quality, legitimate information which you can use as a determining factor when it comes to protecting your business or personal assets.
For more information on screening options, visit our website at www.eRentalServicesInc.com
Bosco Legal Services, Inc. website publications were used as a resource for writing this article.
Monday, November 17, 2014
It can be a daunting or uncertain task…assessing deductions to a renter’s security deposit. There are security deposit laws specific to each state, so you should check the rules and regulations that pertain to your specific location. In most states, you cannot charge your resident for normal wear and tear, but are able to cover your expenses for damages caused by the resident.
This list contains examples of what would qualify as normal wear and tear, which you, as the property owner, are financially liable to repair:
- Faded curtains, carpet, wallpaper or paint due to age or sunlight
- Wear on rugs/carpet (especially in high-traffic areas) due to normal use
- Minor scuffs on floors or trim
- Broken plumbing as a result of daily use
- Broken appliances that are not the result of misuse
- Warped doors and windows caused by moisture, temperature or age
- Small nicks on walls (especially in corners)
- A reasonable amount of holes in the walls due to the hanging of pictures
- Broken seals on doors or windows
- Mold or mildew mitigation (if not due to negligence of resident)
- Replacement of batteries or bulbs for lights and smoke detectors
This list contains examples of what would qualify as damage to the property, which the resident could be financially liable to repair:
- Stains on the curtains or walls that were not previously present
- Ripped, stained or frayed carpets/rugs
- Major scratches or gouges to floors or trim
- Broken or cracked tile
- Clogged drains and toilets due to misuse
- Broken appliances, plumbing or fixtures that are the result of misuse
- Broken doors or windows, including torn or missing screens, blinds, locks and hardware
- Damaged drywall, including excessive holes from hanging pictures
- Broken shelving or cabinetry
- Extermination of fleas or pests
- Cleaning of excessive filth, trash, mildew or mold
- Unauthorized tenant alterations to rental
- Loss income during rental repairs (within reason)
- Depreciated value of the property due to destruction
Back-owed rent, fees or unpaid bills may also be deducted from the security deposit.
Your resident may also be financially responsible for failing to report issues that result in damage to the property. In order to avoid at least partial responsibility for these issues, however, the landlord must have conducted reasonable inspections during the occupancy.
It is important to remember that you need to notify the resident of exactly which items were damaged or needing repair. Provide your renter with a clear list of repairs and even a copy of any receipts. A sample checklist which itemizes conditions upon occupancy and departure from the property, can be found through the following link: Tenant Move In Move Out Inspection
Offer to inspect the unit a few weeks before move-out so that the renter can have the opportunity to repair some of the damage themselves. This can save you some time and effort though a second inspection to confirm completion and quality of work, plus verification that there has been no further damage, is highly advisable.
When calculating the resident’s financial responsibility for repairs bear in mind these two key points:
- It is not legal to charge your residents for upgrades to the property.
- Assess damages with an understanding for depreciation in value
It is important to take into consideration the quality, age and prior condition of the damaged item and then calculate the resident’s financial responsibility based on that data. For example, if a rental unit had a new laminate counter in the kitchen and at the final inspection it was discovered that the surface was marred by a large burn, then the resident would be responsible for the entire cost of replacement. (The item was new at move-in and destroyed at move-out.) The landlord could upgrade to a marble countertop but could only charge the resident for what would have been the cost of replacing the laminate counter.
In order to calculate fees when depreciation is a factor, consider this example: Upon final inspection it was discovered that there was irreparable damage to the carpet. The carpet was of a quality manufactured to have a lifespan of 10 years and was 6 years old at the time of occupancy. The resident is responsible for paying 40% of the replaced carpet expense (which is the percentage equal to the remaining expected lifespan). The replaced carpet value would need to be calculated based on carpet of equal quality to the carpet that was present at occupancy.
If you are not sure what a fair value is for a specific repair, consult with an experienced contractor.
This article is intended as a starting point to help guide you toward a fair and honest assessment of security deposit deductions. There are specific laws in place for each state, and these should be researched before any deductions are applied.
For more rental property information refer to our website: www.eRentalServicesInc.com
Wednesday, October 22, 2014
The Justice Department recently announced that a settlement was reached with the owners and operators of an apartment community in
The lawsuit challenged a policy upheld by the complex which prohibited children from playing outside in the common grassy areas. It was argued through this litigation, that the actions of the defendants constituted a pattern or practice of discrimination against families with children residing on the property.
Complaints were filed with the U.S Department of Housing and Urban Development by 5 families who claimed to be negatively impacted by the apartment policy. HUD investigated allegations and then issued a charge of discrimination against those responsible for initiating and maintaining the policy.
“Federal law guarantees families with children the right to equal access to housing, including full access to their homes’ amenities and facilities,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “Settlements such as this one help ensure that all families can enjoy that right.”
The defendants will pay $77,500 to the victims of their discrimination, and $2,500 to the government as a civil penalty. Additionally, they will be required to implement a nondiscrimination policy, establish new enforcement procedures for rule violations and undergo training on the Fair Housing Act.
As a property owner, is important that you are familiar with the laws surrounding the rental industry. Please refer to our website (www.eRentalServicesInc.com) or contact our office in order to obtain more information on best practice for resident screening and how to stay in compliance with the federal Fair Housing Act.
Source: United States Department of Justice, Office of Public Affairs; http://www.justice.gov/opa/pr/2014/July/14-crt-785.html
Friday, October 3, 2014
Guidelines put into effect in 2012 by the Equal Employment Opportunity Commission have recently come under heavy scrutiny in front of the House Subcommittee on Workforce Protections.
The guidelines are supposed to safeguard employees from workplace discrimination, however, many argue that they are doing a great disservice to employers. Not only has there been significant uncertainty about what is considered to be justified pre-employment screening, but employers are now caught between two bleak options. They either risk EEOC violations by thoroughly screening potential employees, or limit their screening and increase the risk for employing a criminal. Either may have devastating results for their company.
Rep. Tim Walberg, R-Mich., has said that these guidelines not only hinder the employer but could have a negative impact on the overall community: “In certain occupations, a background check of prospective employees is critical to public safety.” These concerns are especially apparent when hiring employees that will be entering private residences or working with children.
Additional complaints were voiced concerning inconsistencies in the EEOC’s approach to investigation and enforcement of discrimination allegations. This seems to be exemplified by recent losses during court cases where the EEOC has challenged an employer’s use of background screening.
Though nothing in the 2012 guidelines prevents employers from conducting criminal records screening during pre-employment, they are supposed to distinguish instances where such screening is appropriate. Unfortunately, confusion and uncertainty are marring the outlined path and have created an unstable foundation for business looking to hire responsibly.
To follow this topic and access other useful screening resources, visit: www.eRentalServicesInc.com
Tuesday, August 19, 2014
In February of last year, the US Department of Housing and Urban Development (HUD) issued a Discriminatory Effects Final Rule to formalize a national standard for determining Fair Housing violations.
“Through the issuance of this Rule, HUD is reaffirming its commitment to enforcing the Fair Housing Act in a consistent and uniform manner,” said HUD secretary Shaun Donovan. The Fair Housing Act prohibits housing practices that result in disparate impact on a group of persons because of race, color, religion, sex, handicap, familial status or national origin.
The practice of running criminal background checks on potential tenants may now be prohibited under the Discriminatory Effects Standard Final Rule.
Many in the rental housing industry have expressed serious concern over the final rule, specifically, the limitations placed on tenant screening. Criminal background checks provide some level of assurance that measures are being taken to uphold resident safety and viability. By restricting a property owner’s right to screen an applicant’s criminal history, this new rule would seem to dramatically increase the property owner’s risk for liability.
A property owner can be held liable for crimes committed by their tenants as criminal activity has a negative impact on the other residents and the surrounding community. The best way to reduce the likelihood of criminal activity and to convince a judge, if necessary, that all reasonable steps were taken to prevent such activity, is to perform a thorough background check on all potential residents prior to their moving into the community.
It presents a large problem for property owners if they are not allowed to perform criminal background checks and are then held liable for a resident’s criminal activity.
Acting Assistant Secretary for Fair Housing, Bryan Greene, has stated that HUD is working on outlining additional guidance for impacted industries. Operating guidelines could be released as early as this summer and would more clearly define what qualifies as “unjustified” discrimination, including information pertaining to criminal background screening.
Visit www.erentalservicesinc.com for more information as it becomes available.
Thursday, July 31, 2014
The function of a security deposit is to provide some assurance that a tenant will return a rental property to its original state (or pay for any necessary repairs). However, one common mistake will diminish the property owner’s ability to apply deposit deductions.
Let’s say that you have a verbal agreement with a tenant that, as landlord, you will repair a garbage disposal, clean the carpets and apply a fresh coat of paint to the bathroom. The soonest that these repairs can be made is one week after the desired move-in date. Upon occupying the unit, the tenant takes photos which highlight its current state of disrepair. You just lost the ability to collect full reimbursement for damages from the security deposit. When the lease expires the tenant has a justifiable reason to refuse deposit deductions, as they can fairly argue that they returned the unit to its original condition. You may very well have upheld your verbal agreement, and the tenant benefited from the repairs made to the unit, but under these circumstances a judge will rarely be swayed to demand reimbursement for damages.
Do not allow a new tenant to move-in to a rental unit until it is cleaned and repaired as needed. Conduct a walk-through with the tenant and itemize a move-in/move-out agreement. This agreement must contain language as required by the Warrant of Habitability Law and should be signed by both the landlord and tenant prior to move-in (and then again during the walk-through at move-out). Keep the agreement, and any photos of the unit, with the lease contract in a safe or locking filing cabinet.
RSI provides access to many such documents for rental property owners. To download a standard Move-In Move-Out agreement, select the following link: Tenant Move In Move Out Inspection
For more information visit our website at www.erentalservicesinc.com