What should (and shouldn’t) you consider as you screen prospective tenants?

On Behalf of | Sep 1, 2021 | Real estate transactions

Whether you have one home to rent or an entire apartment building, screening prospective tenants can help you avoid financial losses and just all-around problematic renters. Here in Arizona, landlords can charge a non-refundable application fee to prospective tenants to cover the screening costs.

Screening services can cover a number of criteria. Determining which ones are most important and staying away from any criteria that could be considered discriminatory are both keys to a productive screening process.

What kinds of things should landlords consider?

It’s typically wise to look at things like:

  • Income
  • Bankruptcies
  • Criminal convictions
  • Liens and judgments
  • Past evictions
  • Address history

Some things, like perhaps a bankruptcy, may not necessarily warrant declining an applicant. 

Avoiding allegations of discrimination

It’s imperative that you use the same screening criteria for all potential renters. If you don’t use the same criteria consistently, it’s easier for a person who belongs to a protected class to allege that you discriminated against them.

If you do change your criteria, you need to be careful that you do it for everyone going forward. Don’t switch back and forth among criteria with each available rental. 

Arizona’s law is consistent with the federal Fair Housing Act (FHA), which prohibits discrimination based on:

  • Race
  • Color
  • Sex
  • Religion
  • National origin
  • Familial status
  • Disability 

Property owners need to be sure that they don’t discriminate in any way, including in their advertising of available rentals.

It’s wise for anyone who has residential or commercial tenants to know and understand both federal and state fair housing laws. This can minimize your chances of facing a lawsuit in the future that could be both time-consuming and costly. Always remember that it’s far easier to prevent a problem than it is to fix one.