If you’re worried about tenant applications, it might be time to brush up on the laws regarding when you can and cannot deny a rental application. Every landlord should know these rules, so it is important to keep up to date on these rental application laws. Explore fair housing, applicant details that you can deny for, and details that you cannot deny for.
When renting out a property, you will encounter a wide variety of rental applicants from different backgrounds and life experiences. These varied prospective tenants may be wonderful renters who make your life a breeze as a landlord. But, occasionally, you will find yourself handling a tenant who may be problematic.
It is important to know when you can and cannot deny a rental applicant. There are many valid reasons to approve or deny a rental application, based on the applicant’s qualifications. There are also some legal protections prohibiting a landlord from denying applications based on certain criteria.
Here are some scenarios in which you can and cannot deny rental applications. Bear in mind that state laws differ from national laws, which means you might have additional restrictions on what you can and cannot deny a rental application for. Additionally, if you do deny a rental application, you must follow a set of legal requirements upon that denial.
Learn more: Legal Requirements for Denying a Rental Applicant (Adverse Action Letter)
Federal Fair Housing Compliance in Rental Applications
A landlord cannot deny a rental application based on any discriminatory factors. The U.S. Department of Housing and Urban Development states that, according to the Federal Fair Housing Act, an applicant cannot be denied based on any of the following factors:
- Race
- Color
- National Origin
- Religion
- Sex
- Familial Status
- Disability
State laws may add additional fair housing criteria, such as:
- Marital Status
- Sexual Orientation
- Gender Identity
If someone can prove that a housing provider has denied them housing or otherwise had housing-related services denied because of any of these factors, the housing provider may face a lawsuit. Additional consequences may include fines, paying damages to the victim, or even potential criminal charges.
Learn more: The Fair Housing Act: Anti-Discrimination Laws for Landlords and Property Managers
When You Can Deny a Rental Applicant
There are many reasons why a landlord could reasonably deny a rental application. These enable them to protect themselves and their property from potential problems related to an untrustworthy tenant. Valid reasons that a landlord can deny a rental application include, but aren’t limited to:
- Poor credit history
- Poor references
- Criminal convictions relevant to their fitness as a tenant
- Pet ownership
- Smoking status
- Incomplete applications
It should be noted that a landlord must apply these denials to all tenants equally. If one prospective tenant cannot rent a property due to their credit history, any other prospective tenants with similar credit histories must be denied as well. It is advised that you set up a solid, defined list of rules that you are and are not willing to deny an applicant based on.
Learn more: How to Create Written Tenant Screening Criteria
State laws may also provide more valid reasons for the denial of an applicant, but these vary significantly from state to state. These reasons may need to be researched separately for your individual circumstances.
When You Can’t Deny a Rental Applicant
While not protected under the Fair Housing Act, some additional factors may not qualify for denying rental applicants. Some factors that you cannot deny an applicant based on vary by state, or clarify and further elaborate on the protected classes defined by the Fair Housing Act. Other reasons for denial that are prohibited include ownership of service animals and various state laws.
A common state law prohibits landlords from denying rental applications based on a tenant’s source of income. Other similar laws can vary by state, so it is best to look into your specific state’s fair housing laws and speak to a lawyer if you have questions.
Final Thoughts
Deciding whether or not to deny a rental application is an important aspect of renting out a property. You should always be aware of the legal aspect of whether or not you can deny an application. Fortunately, understanding these laws is easy, and when you know what you can and cannot do, you can easily set up parameters for your tenants, which makes approving and denying rental applications a simple task.