FCRA Tenant Screening Compliance: Who Qualifies and What You Get
Learn the rules for using credit reports to vet tenants and how to avoid legal risks when denying rental applications.
This compliance framework sets the rules for how credit information can be used when making decisions about renting to potential tenants.
Who it's for
This is for managers who perform credit checks on applicants to determine their suitability for a lease.
What you get
You receive a legal framework that governs how you can use credit data to make leasing decisions. This ensures your screening process follows federal standards.
What it costs you
Compliance requires extra administrative work. If you deny a rental application based on information found in a credit report, you are required to provide the applicant with an "Adverse Action" notice.
The catch to know
The biggest risk is using a screening service that does not follow these regulations. If your screening process is non-compliant, you could face expensive class-action lawsuits.
How to apply
- Review your current tenant screening process.
- Ensure your screening service provider is fully compliant with federal regulations.
- Set up a process to issue required notices if a report leads to a denial.