This April, The Department of Housing and Urban Development, HUD, published a series of surprising new guidelines. Many landlords are raising their eyebrows… If you’re a landlord, you’ll want to read this.
HUD’s new guidance essentially states that turning down tenants or buyers based on criminal record sometimes violates the Fair Housing Act. This means that what is now a common practice, refusing to rent to criminals, may be a violation of the law. The guidance argues that the new regulations are necessary because:
When individuals are released from prisons and jails, their ability to access safe, secure, and affordable housing is critical to their successful reentry to society. Yet many formerly incarcerated individuals, as well as individuals who were convicted but not incarcerated, encounter significant barriers to securing housing, including public and other federally-subsidized housing, because of their criminal history. In some cases, even individuals who were arrested but not convicted face difficulty in securing housing based on their prior arrest. Across the United States, African Americans and Hispanics are arrested, convicted and incarcerated at rates disproportionate to their share of the general population. Consequently, criminal records-based barriers to housing are likely to have a disproportionate impact on minority home seekers.
The Big Takeaway: Landlords Are Liable…
So the big takeaway here is, “Landlords could be breaking the law when they refuse to rent to people with criminal records — even if they have no intention to discriminate — because such a policy would likely have a disproportionate impact on African-American and Hispanic applicants. ” (NPR)
Housing Secretary Julian Castro puts it another way:
When landlords refuse to rent to anyone who has an arrest record, they effectively bar the door to millions of folks of color for no good reason.
But many private landlords and public housing projects have policies against renting to people with criminal records. Or they may not deny potential tenants outright, but they may let one’s criminal history influence decisions about rentals financing, sales, and other real estate activity. So a lot of worried landlords are asking, “How do I comply with HUD’s new guidelines?”
Although the HUD guidelines state that the determination of whether there has been a violation will be made on a case-by-case basis, this is the basic definition of what HUD now considers an infraction:
[The] selective use of criminal history as a pretext for unequal treatment of individuals based on race, national origin, or other protected characteristics.
How Landlords Remain Compliant
So how does a housing servicer ensure that he’s staying above board? Here’s a few good rules of thumb for landlords to consider:
- A landlord should avoid “selectively using” criminal history to discriminate against someone based on their race, national origin, or color. Pretty much goes without saying, right? Deny a person of color based on a certain crime? Then don’t accept a white applicant if he has a similar record. Whatever your policies are, strive to enforce them evenly across applicants of all backgrounds.
- You might think that as long as you apply the same rules to everyone that you’ll be safe. Unfortunately it’s not that easy. You can’t just make a blanket ban on all criminals. Refusing to rent to all ex-cons—no matter what they did or when they did it—is not defensible. Not all ex-cons pose a risk to safety or property.
- Review your policies regarding the use of criminal background checks. See how you applied those background checks historically. Lastly, communicate your policies clearly to your employees.
- If you do run a criminal background check, make it the last part of your screening process.So, verify that their credit check comes back clean, and then run your background check. This will help eliminate any doubt that you are discriminating.
- Consider the nature and severity of the crime, as well as how recently it occurred. Let your applicant state their case. Let them present the mitigating circumstances of their record, like evidence of good tenant history, their age at the time of conviction, or clear evidence of rehabilitation. Just be flexible. Have a heart.
Do’s and Don’t Of Criminal History Housing Practices
Are The Regulations Fair?
Now that we’ve broken down how to navigate these muddy waters, let’s break this down: are these regulations fair? That depends on your perspective. On the one hand, says HUD director Julian Castro,
The fact that you were arrested shouldn’t keep you from getting a job and it shouldn’t keep you from renting a home. When someone has been convicted of a crime and has paid their debt to society, then they ought to have an effective second chance at life. The ability to find housing is an indispensable second chance in life.
One affordable housing advocate said,
The Fair Housing Acts protects Americans from discrimination, whether intentional or not, including those have a criminal record. We now know that racial disparities exist in the U.S. criminal justice system. So, we must ensure that those who need housing the most are not denied a roof over their head. HUD’s new policy is a small but important step in alleviating the continual cycle of poverty that keeps many families and individuals from better opportunities and a better life.
On the other hand, a landlord could be worried that these regulations are too vague. They might feel too open-ended for following faithfully. If it truly is judged on a “case-by-case” basis, then how could there possibly be objectivity in prosecution?
Conclusion: Takeaway For Landlords
It goes without saying that every infraction seems judged on a “case-by-case basis”. Each case is its own. But are these regulations clear enough that a landlord can be absolutely confident that he’s in the clear? It’s hard to say. All we can tell you is to follow the tips we’ve presented, and make sure to carefully read HUD’s own guidelines for yourself.
You’ve got a lot on your plate already. Big State buys from overworked landlords all the time. Are these regulations a tipping point for you? Then it might be a good idea to offload some of your properties.
But what do you think of this change? Long overdue policy that will help curb Jim Crow business practices? Or just another example of regulations and red tape from Washington run amok?
Let us know!