New HUD Guide Line on Use of Criminal Records for Tenant Screening

On April 4th, 2016, The Department of Housing and Urban Development (HUD) released a guidance memo on how landlords can use arrest and conviction records when screening tenants. According to NOLO, guidance memos do not have legal authority of a court decision but are considered highly by judges when making legal decisions.

The HUD memo discusses how under federal fair housing laws, protected class status does not extend to individuals with criminal records. Therefore, landlords were previously able to decide whether they would categorically reject all tenant applicants that had a criminal record. Fair housing advocates have worked to ban the practice of automatically rejecting applicants with a criminal record. Housing advocates have argued that they have legal precedent against landlords automatically rejecting applicants with a criminal record as a result of a the Supreme Court Case Texas Dept. of Housing & Community Affairs v. Inclusive Communities Project, Inc., which ruled that housing discrimination can be proved if a tenant screening policy harms people in a protected class.

Therefore, the recent HUD memo indicates that automatically rejecting tenant applications because of arrests and convictions may be a form of indirect discrimination against a protected class as this policy harms African Americans and Hispanics more frequently than Caucasians. The recent HUD memo advises that landlords should not reject tenants based solely on arrests without convictions. The main argument that landlords have used for the practice of automatically screening out tenants with a criminal record was that landlords need to keep individuals on their rental property safe from criminals. However the HUD memo suggest that the reasoning for rejecting a potential tenant based on the desire to keep other tenants, guests and employees safe does not apply to tenants that have been arrested but not convicted of a crime.

It is important for you to stay up to date in new guidelines that affect property owners and management companies. Your property management system needs to be up to date as well. RISSOFT’s software for property management has up to date features and resources that help property owners and managers stay a head of the industry. If RISSOFT‘s affordable property management software does not have a feature your looking for they will work with you to add that feature so that you can fulfill all your property management needs.

This post is provided by RISSOFT Residential and Commercial Property Management Software, specializing in innovative and cutting-edge property management software for all 50 states. Request a demo or contact us today to receive more information.

Disclaimer: The information provided in this post in not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.