Landlords commonly conduct background checks and use credit reports to verify that a potential tenant will pay rent, treat the unit with care, and not cause trouble for neighbors. Background checks for tenants are designed to keep everyone involved safe. It’s up to the landlord whether they feel a background check is necessary or not.
If errors appear on your credit report, it may limit access for housing and cause landlords to deny approval. Like with an employment background check, The Fair Credit Reporting Act (FCRA) requires Consumer Reporting Agencies to ensure the highest possible level of accuracy of the information in the reports. These companies must be fair, impartial, and respect the consumer’s right to privacy.
Landlords can screen applicants in a variety of different ways as long as they are using non-discriminatory methods. They must ask the same questions of all potential renters. Applicants that are denied tenancy due to a screening report must be informed of the reasons why. There are many different methods and services that a landlord may use to obtain background information on their applicants. Some use services that look up the information for them and others do little screening at all.
Landlords are required to have a “permissible purpose” for obtaining any sort of consumer report, and tenant screening fits the criteria. However, landlords must only use the information in the reports for housing purposes. They must inform a tenant or applicant if they plan on taking any sort of adverse action because of the information in the report. This could include denying a lease, requiring a co-signor or requiring higher rent than other applicants. This notice can be given orally, in writing, or electronically.
When a tenant’s rights have been violated, or they believe there are errors in their background check that are causing problems, federal law protects them through the FCRA.
When landlords violate these laws, or when your background check shows incorrect information, our partners, as consumer law attorneys can help you fight back and get the information corrected. When you deserve compensation for missed opportunities, or are being discriminated against, they are skilled and able to fight for your rights as a consumer and tenant.
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