Landlords who have a rule banning applicants who were convicted of a crime-may want to rethink that policy.
Recent guidelines issued by the US Department of Housing and Urban Development (HUD) on April 4, 2016 call for landlords to do away with blanket bans, that disqualify applicants based on prior convictions or arrests. Having a general ban, that precludes applicants from housing solely on the basis a criminal record, could be considered a violation the Fair Housing Act.
The Fair Housing Act; signed in 1968, prohibits landlords from discriminating on the basis of race, color, religion, sex, or national origin. While criminal history is not a protected class, under the new HUD guidelines, turning down applicants on the basis of a criminal record, without considering the nature of the crime or facts surrounding the conviction, can’t be legally justified –and could, indirectly, be a violation of the Act.
As many as 100 million U.S. adults, or nearly one-third of the population, have a criminal record of some sort. Additionally, the United States prison population, with 2.2 million adults, is the largest in the world. Since 2004, an average of over 650,000 people have been released every year from both federal and state prisons –and 95 percent of those currently incarcerated, will be released at some point in the future.
For individuals who are released, the ability to secure safe and affordable housing is a crucial part of their successful reentry into society. Yet many individuals who were formerly incarcerated are finding it extremely difficult to secure housing –because of their criminal history.
Troubles Securing Housing
Michael Bowers, a single father, has had his share of trouble finding housing in Austin, Texas.
This is due to the fact that Bowers has a criminal record. As a teenager, he was arrested for stealing a debit card and going on a $340 shopping spree.
“I was young,” says Bowers, speaking of his crime. “We were drinking. There was a card. I was like, ‘I’m going to use that to buy stuff that I want.’ It was a dumb mistake.”
This crime led to Bowers spending a few days in jail and being put on probation. Today, however, nearly ten years later –one consequence of this mistake continues to plague him –most landlords still refuse to rent to him.
“The most frustrating thing is I’m just a single dad,” says Bowers, who lives in Austin with his daughter. “I work hard, and I just want to give my child a place to live.”
The fact remains that many landlords are rejecting tenants on the basis of their criminal history –or even an arrest that never even led to a conviction, without taking into account the nature of the crime, how long ago it occurred, or rehabilitation.
For people like Bowers who are trying to get their life back together, finding housing remains one of the most difficult hurdles.
The HUD Guidelines: Disparate Impact
While many landlords still screen out applicants based on a criminal history or an arrest record, doing so may be a violation of the Fair Housing Act.
A landlord violates the Fair Housing Act when their policy or practice has an unjustified discriminatory effect, even if the landlord had no intent to discriminate. This is known as “disparate impact” –which occurs when policies or practices that appear on the surface to be neutral, result in a disproportionate impact on a protected group.
“Criminal records-based barriers to housing are likely to have a disproportionate impact on minority home seekers,” the guidelines note. Black and Latino Americans are disproportionately affected, the memo notes since they are incarcerated at rates disproportionate to their share of the general population. Black and Latino individuals comprise an estimated 58 percent of the U.S. prison population, despite accounting for only 29 percent of the total U.S. population.
Under this standard, even a policy that may seem neutral on the surface –could have a discriminatory effect against protected classes, and thus could be a violation of the Act, if it’s not supported by a legally sufficient justification.
It’s important to note that while HUD doesn’t recognize having a criminal record as a protected characteristic under the Fair Housing Act; proponents argue that criminal history-based restrictions on housing opportunities could, indirectly, violate the Act.
Additionally, proponents state, that by making it easier for people with an arrest record or criminal history to find a home, housing providers will help to increase the chance of an individual’s successful reentry to society.
“The fact that you were arrested shouldn’t keep you from getting a job and it shouldn’t keep you from renting a home,” says HUD Secretary Julian Castro. “The ability to find housing is an indispensable second chance in life.”
JoAnne Page, President, and CEO of the Fortune Society, which works with formerly incarcerated individuals, also highlight the importance of housing for individuals with a criminal background. “We know that if a person does not have a stable, affordable place to live, being a contributing member of society is extremely difficult,” she says.
Considering a Criminal Record: A Landlord’s Requirements
While the HUD guidelines outline what landlords should not do when weighing up a potential tenant’s application, they’re less clear on what type of criminal convictions can be used when assessing an applicant.
As there are no guidelines on which crimes should be considered acceptable, and which are not, aside from certain drug-related charges. In most cases, landlords are advised to use their discretion, with the HUD guidelines stating that they should consider circumstances on a case-by-case basis.
Case-by-case, means that imposing a blanket ban on individuals with a criminal history, is no longer an option. Instead, landlords and property managers will have to put a bit more care into evaluating applications on an individual basis.
Industry groups, such as the National Apartment Association, are weighing in on the new guidelines. The NAA released a white paper on best practices to members, which advised taking measures such as adjusting screening policies to include only certain types of offenses –rather than a blanket ban, outlining clear justifications for those policies, and giving applicants a chance to explain mitigating circumstances.
While the HUD guidelines are just that, guidelines –and landlords are not bound by law to follow them, the best practice is for landlords to take the HUD guidance seriously, and change any current policies that automatically exclude applicants with a prior conviction; as well as any policies that have not been thoughtfully developed and justified.
Steps Landlords Should Take to Comply With the New HUD Guidelines
While these guidelines may sound daunting –the good news is that for most landlords, they may not be as formidable as they sound.
“Employers have been taking most of these steps for years,” explains attorney Denny Dobbins, “It will not be difficult for good Landlords to comply.”
In order uphold these guidelines, though, landlords will need to need to be a bit more thorough when it comes to documenting their reasons for denying an applicant. They’ll also want to ensure that their policy’s approval criteria, as it pertains to a person’s criminal history, are supported by a legally sufficient justification. For example –if a landlord has an apartment complex, they must also take the safety of the other residents into consideration; therefore they may be able to prove that banning individuals who have committed violent crimes is a justifiable decision. Additionally, landlords who house families with children may not be able to rent to anyone on the Sex Offender Registry. Thus, denying a registered sex offender would not constitute a violation of the Fair Housing Act.
But under these guidelines, landlords cannot institute a sweeping ban on all applicants with a criminal history, and cannot reject applicants for arrests that did not lead to a conviction. Additionally, landlords must take care to ensure that all potential applicants are treated the same; and that comparable criminal histories are assessed similarly; without considering race, national origin, or any protected class.
Consider the Crime
HUD states that a housing provider must show that its policy accurately distinguishes between criminal conduct that indicates a demonstrable risk to resident safety or the property and criminal conduct that does not.
Landlords are advised to take into consideration the nature of an individual’s conviction as well as time elapsed since the conviction. The only clear exception that the guidelines make is for convictions for manufacturing or distributing drugs.
Factors that landlords should consider include:
- The nature of the crime
- The facts or circumstances surrounding the criminal conduct
- Time elapsed since the conviction
- Evidence of rehabilitation
The Nature of the Crime
Landlords that oversee multi-unit residences must balance out their nondiscriminatory screening policies, with their duty to ensure resident and property safety. This means assessing the nature of the crime to see if there is legally sufficient justification to ban an applicant from the housing. Unfortunately, this is a gray area –and one where landlords and property managers alike much exercise diligence and discretion.
While the HUD guidelines aren’t clear, HUD indicates on their website that for public housing authorities, a criminal background investigation must be performed to determine lifetime registered sex offenders –which then may be precluded from housing. It would seem to follow, that if public housing authorities can draw the line at registered sex offenders that non-public housing landlords could do so as well. But when it comes to offenders who are not on the registry, the guidelines are less clear.
“The nature and gravity of a sex crime may be so serious that even the slightest amount of risk may be too much when contemplating the protection of your substantial and legitimate interest(s),” says Denny Dobbins, attorney. “A case-by-case evaluation based on the facts is necessary for how long to prohibit residency for those with a sex crime who do not have a lifetime sex offender registration status.”
Landlords who are uncertain should consult with an attorney.
The Facts or Circumstances Surrounding the Criminal Conduct
Landlords are advised to assess the circumstances surrounding the criminal conduct. This means that they should consider the age of the applicant at the time of the crime, as well as any other mitigating details. Landlords should also take care not to exclude applicants based on arrests alone since an arrest doesn’t always lead to a conviction.
Time Elapsed Since Conviction
The amount of time that’s passed since the conviction occurred should also be taken into account. Although the HUD hasn’t given a specific timeline that’s reasonable for felonies or misdemeanors, some have suggested a period of six or seven years for some felonies or high-risk crimes.
Evidence of Rehabilitation
If an applicant presents evidence of rehabilitation, this should be taken into consideration as well.
Practically Screening Applicants
There are practical ways that landlords can maintain compliance with the HUD guidelines.
Here’s a look at a few things landlords should consider doing:
Run Criminal Background Checks Last
When it comes to the application process, landlords and property managers may want to consider running criminal background checks last; until after an applicant has already passed employment and income verification, credit checks, and previous rental history. Not only will this help to keep housing providers from having to make many potentially difficult decisions, it will also save time when processing applications.
Avoiding Problem Screening Questions
One key area where landlords should tread especially carefully is when screening tenants. Asking potentially problem questions such as, “Have you ever been convicted of a crime?” and instead, looking to ask more relevant questions, such as “Have you been convicted of a crime in the last seven years?” is a better option; one that shows that the landlord isn’t imposing an outright ban on applicants with a criminal history; and instead is asking relevant questions and assessing applicants on a case-by-case basis.
Ask for Proof of Mitigating Circumstances
Landlords and property managers should consider informing applicants that, if they have a criminal background, they are welcome to submit proof of mitigating circumstances at the time of the crime as well as proof of any rehabilitation efforts. Requesting this information is a step in the right direction, and also shows that the landlord isn’t implementing a sweeping ban on applicants who have a criminal background.
Review Existing Policies
Finally, landlords and property managers should review their existing rental policies and tenant screening procedures. Landlords should pay special attention to ensure that there are no qualifying questions that could be considered discriminatory against potential tenants. Doing away with sweeping statements, such as disqualifying all applicants who have a criminal background; and instead implementing policies that allow for a case-by-case analysis is an important step that housing providers should take to protect themselves.
Landlords should inquire with the current and previous landlord to assess an applicant’s qualification. Questions to ask include:
- Did the applicant pay the rent in full and on time?
- Did they abide by all the terms of the lease?
- Were there any problems with the applicant?
- Were there complaints from other tenants about illegal activity?
- What was the timeframe that the applicant rented in the unit?
- Would you rent to the applicant again?
Landlords should also obtain a consumer credit report and carefully check the information therein. Landlords should:
- Check the information for accuracy. Ensure that the information on the report matches what is on the application –including the name, date of birth, and address.
- Was each credit grantor paid on time?
Every landlord should have a written list of rental criteria, and ensure that they uphold it consistently with each rental application. Examples of rental criteria include:
- Sufficient Income
- Proof of Income That’s 3x the Rent
- Good Landlord References
- History of On-Time Rent Payments
- A Good Credit Report
- The Ability to Abide by the Terms of the Lease
If an applicant fails to meet the above criterion, the fact that they may have a criminal record becomes irrelevant. In the end, the best way for a housing provider to avoid claims of discrimination and ensure equality for all applicants –is to ensure that decisions are not based on one single factor; a criminal record, and instead seek to use other qualifying questions when making a decision.
In addition to helping to prevent claims of discrimination, this method will also help to alleviate fears of landlords, who may be concerned about safety implications that come from not having a blanket ban in place. As Chris with Tenant Verification Services writes, “In most instances…individuals who have a criminal record and continue to lead that type of lifestyle, will not meet your criteria anyways.”
Finally, landlords should make sure they have a look at the HUD Guidelines for themselves, as well as this helpful white paper from the NAA. They should also consider consulting with an attorney, to ensure that their screening policies, qualifying questions, and applications –are all in the clear.
Tenants: do the HUD guidelines affect your home search?
Disclaimer: The information provided is for and advisory purposes only. Springs Homes accepts no responsibility for its accuracy. We recommend that you consult with an attorney familiar with current federal, state, and local laws.