Following HUD Guidelines on Criminal Background Checks Can Be Problematic – by Deborah Lopez

Reprinted with permission of  the Apartment Owners Association

Screening tenants is a vital part of the job of a landlord or property manager.  While most of the criteria – credit score, income, employment – by which prospective tenants are screened, are straightforward to evaluate, one in particular is not – criminal background.

In order to steer clear of allegations of discrimination by a rental applicant, it’s important to take due care if you use the criminal background check to eliminate a prospective renter

The U.S. Department of Housing and Urban Development (HUD) estimates that as many as 100 million adults in the United States have some sort of criminal record.  Because a disproportionate  number of minorities undergo arrest, conviction and incarceration in this country, using the existence of an arrest or conviction record as part of the tenant screening process for housing often has the effect of discriminating against those groups.  While individuals with criminal records are not a protected class, they can fall under the protections of the Fair Housing Act (FHA).

Last year, HUD released new guidelines on the use of criminal background checks in rental housing.  The guidelines are based on a legal standard upheld last by the U.S. Supreme Court, allowing plaintiffs to challenge rental housing practices that have a discriminatory effect, without having to show discriminatory intent.

In general, not renting to persons with a criminal record may be justified based on the need to protect the safety and property of other tenants.  But there must be a careful examination to prove that any decision made about a prospective tenant will actually advance that goal.  The HUD guidelines provide some dos and don’ts but leave much room for interpretation.

The HUD Guidelines

  • A housing provider cannot justify an exclusion based solely on an arrest record but no conviction.
  • A blanket ban on any applicant with a criminal record is illegal.  Landlords must take a more individualized approach to avoid violating the FHA.  A policy must show that the landlord “accurately distinguishes” between criminal conduct that poses a risk to safety and criminal conduct that does not.
  • A criminal background review must take into consideration both the severity and type of crime and the length of time since the person was convicted and must be decided on a case-by-case basis.  Every situation is unique.  A non-violent crime committed 20 years ago must be treated differently from a violent crime committed more recently.  The only exception is a conviction for drug manufacturing and distribution.  A blanket ban on applicants convicted of such crimes is legal.
  • Other factors must be considered in the evaluation to establish that the landlord is using the least discriminatory policies possible.  Besides the severity and type of crime, the person’s age when convicted, rehabilitation efforts since conviction and tenant history must also be considered.
  • Any intentional discrimination using criminal background as a pretext to deny housing is a violation of the RHA.  For example, a landlord cannot turn down a minority applicant with a criminal record while accepting a Caucasian with a similar record.

Each year, 650,000 people are released from federal and state prisons.  The reality is they all need to find housing.  As rental housing providers, it is important that we apply these HUD guidelines in our tenant screening process.  Giving people with criminal convictions a second chance without jeopardizing the safety of your other tenants is a worthy societal goal.

Deborah Lopez is a SPOSFI business member.  Reprinted with permission of the Small Property Owners of San Francisco Institute (SPOSFI) News.  For more information on becoming a member of SPOSFI or to send a tax-deductible donation, please visit their website at www.smallprop.org or call (415) 647-2419.

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