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Property managers, landlords, and housing providers are legally required to provide an adverse action notice to rental applicants whose applications were denied during the tenant screening process, per the Fair Credit Reporting Act (FCRA).<\/span><\/p>\n Starpoint provides a free Adverse Action Notice for housing providers: <\/span>Free Denial Letter<\/span><\/a><\/p>\n If you are a Rentec Direct Client you can use this template from Starpoint:<\/span><\/p>\n CLICK HERE TO USE THE STARPOINT TEMPLATE<\/span><\/a> If you are declining the application based on information obtained within their TransUnion credit report.<\/span><\/p><\/blockquote>\n According to the <\/span>FCRA<\/span><\/a>, when you look at a rental applicant\u2019s consumer reports as part of your tenant screening process<\/a>, you must send an adverse action notice to the rental applicant.\u00a0<\/span><\/p>\n A consumer report is a background report that contains personal information on a consumer, like:<\/span><\/p>\n The reports listed above are commonly used in tenant screening<\/a> to determine if a rental applicant will be a qualified renter. So, if you use any type of consumer report during your tenant screening process, you must understand your requirements for providing an adverse action letter to your rental applicants.<\/span><\/p>\n The Federal Trade Commission(FTC) and FCRA refer to the term adverse action, which may include denying a rental applicant housing or deciding not to renew a lease agreement, based on information found in a consumer report.\u00a0\u00a0<\/span><\/p>\n According to the <\/span>FTC<\/span><\/a>, other common examples of adverse action in housing include:<\/span><\/p>\n If you deny a rental application for any legal reason and you accessed any type of consumer report as part of your tenant screening process, you must provide an adverse action notice to the rental applicant.\u00a0<\/span><\/p>\n Remember to always use a legal tenant screening process that upholds requirements of the <\/span>Federal Fair Housing Act<\/span><\/a>, the FCRA, and other federal, state and local <\/span>landlord-tenant laws<\/span><\/a>.\u00a0<\/span><\/p>\n A housing provider can find a qualified renter by reviewing an applicant\u2019s credit report and criminal record, verifying employment and income, checking references, and speaking to your past landlords to find out if they were a lease-breaking tenant.<\/span><\/p>\n You are not allowed to deny any rental applicants due to their race, religion, sex, familial status, disability, color, or national origin, under the Fair Housing Act.<\/span><\/p>\n To save yourself from any discrimination claims, you need to be able to tell a rental applicant exactly why they didn\u2019t get approved for a rental property.\u00a0<\/span><\/p>\n If you simply tell a rental applicant it\u2019s not going to work out but you give them zero reasons, they can file a discrimination claim, even if you based your decision on legal reasons. If they happen to belong to a protected class, you could be in some legal trouble. (It\u2019s called disparate-impact and you can learn more about it here: <\/span>Are you breaking Fair Housing Laws unintentionally?<\/span><\/a>)<\/span><\/p>\n The best way to deny a rental applicant is to send an adverse action letter or adverse action notice. In fact, if you use consumer reports as part of your tenant screening process, you must<\/em> send an adverse action notice.<\/p>\n You need to provide an adverse action notice to your rental applicants if you accessed a consumer report on them. The most common consumer reports used in tenant screening are credit reports, criminal background reports and eviction history reports.<\/span><\/p>\n If an applicant is rejected based on information found on a credit report, the landlord must provide an <\/span>Adverse Action Notice<\/span><\/a> to the applicant.<\/span><\/p>\n An Adverse Action Notice tells the renter that he was denied due to information found on a consumer credit report, and gives contact information for the credit reporting agency used so the applicant can access the report too.\u00a0\u00a0<\/span><\/p>\n Starpoint provides a free Adverse Action Notice for housing providers: <\/span>Free Denial Letter<\/span><\/a><\/p>\n If a renter contacts you saying that the information on their credit report is inaccurate, you should advise the renter to refer back to the Adverse Action Notice you provided and speak directly with the credit reporting agency to figure out how to make adjustments to their credit report.<\/span><\/p>\n If you deny a rental applicant due to information found on a public record (like a criminal background report or eviction search) you need to provide the applicant with an adverse action denial letter and instructions on how they can obtain a copy of the report.\u00a0<\/span><\/p>\n You do not need to provide a copy of the report, just tell the applicant which agency you used to access the report and who to contact to get a copy.<\/span><\/p>\nDo I Need to Send an Adverse Action Notice to a Denied Rental Applicant?<\/h2>\n
Consumer Reports for Tenant Screening<\/h2>\n
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Adverse Action in Tenant Screening<\/h2>\n
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Legal Tenant Screening<\/h2>\n
An Adverse Action Notice or Adverse Action Denial Letter<\/h2>\n
Adverse Action Notice for Credit Report Data<\/h2>\n
Adverse Action Notice for Criminal Background Data<\/h2>\n