Friday, March 2, 2018
Legislative Changes That Could Affect Your Business in 2018!
Hello Valued Client,
If you’re a property owner, investor or property manager you may have noticed an increase in legal issues pertaining to the Multifamily Industry.
Many state and local governments have recently passed or are discussing legal issues that affect background checks. Here are a few that we found to be interesting.
The City of Seattle Washington has enacted a city ordinance that prevents the use of criminal records as part of the tenant background screening process. The Fair Chance Housing ordinance prohibits a landlord from using any criminal offense when choosing whether to rent to someone. The only exception is for registered sex offenders.
Colorado had a 3rd reading of House Bill 18-1127 on February 26, 2018. This concerns the application process for prospective renters. The Bill will limit the amount an applicant can be charged for a rental application fee. Rental criteria must be provided in a written format and applicants must receive an adverse action notice if the applicant is denied.
Let’s look at each requirement of HB 18-1127 in more detail and discuss how Rental Services, Inc. can make sure if it passes, you have nothing to worry about.
HB 18-1127 will require you to charge the same application fee for every applicant that applies based on your actual screening costs. If you don’t currently charge the same fee to everyone, start now. Charging different application fees could open you up to a Fair Housing complaint. Don’t offer a discounted application fee to married couples. Never increase the application fee based on square footage or number of bedrooms. Treat everyone the exact same way. Have a set fee based on your screening costs and stick with it. If you do, this part of HB 18-1127 wont have any affect on your business.
A receipt for the application fee will be required with HB 18-1127. Providing a receipt is just a good business practice. If you use the RSI Quick App each applicant is already sent a receipt via email after the application is submitted and paid for with a credit card. Rental Services, Inc. offers a 2ply paper rental application. At the top of the application is a box to write in the application fee. Once the applicant completes the rental application, detach the form and give a copy to the applicant as a receipt. If you don’t use an RSI application a receipt will need to be generated if the Bill passes.
HB 18-1277 will require all applicants to receive written rental criteria. Everyone should have written rental criteria in place already. If you don’t, call or email us and we can help you set it up. Good rental criteria will explain your rental standards pertaining to criminal history, rental history, credit history and income requirements. Have the applicant sign a copy of your rental criteria when they complete the rental application. If you use the RSI Quick App we recommend sending us a copy of your rental criteria, so it can be added to your current online rental application.
HB 18-1277 will prevent you from using rental or credit history that is older than seven years. This requirement is already addressed in the Fair Credit Reporting Act. Credit Reporting Agencies cannot currently report credit, criminal or eviction information that is older than seven years. If you make your own reference calls the seven year rule would apply to you.
If you decide not to rent to the applicant based on your rental criteria you will be required to give them an adverse action notice. This is already required as part of the Fair Credit Reporting Act as it pertains to CRA’s. Each application processed by Rental Services, Inc. generates an adverse action notice. All you need to do is print it from the RSI website.
As you can see the Multifamily Industry is always changing. To stay up to date with current services, industry issues, FCRA compliance or you just want to ask a question visit the RSI Facebook page. https://www.facebook.com/pg/RentalServicesInc