One important part of managing property is screening tenants, and if you’re new to this, then you’re probably wondering when it is okay and not okay to deny tenants their application.
While there are general guidelines to follow, the best way to go is to get advice from a professional Issaquah property management company.
The Tenant Has Bad Credit
If your prospective tenant has bad credit, no money in their bank account, and a history of not paying, then you don’t want them as a tenant. In this case, it is perfectly acceptable to deny them on the grounds that they are too much of a risk to you financially.
The Tenant has Pets
If you have a firm no pets policy in your contract, then it is perfectly legal to deny a tenant because they have a pet. Furthermore, you can ask them to leave or get rid of the pet should they choose to acquire one during residency.
Bad References
If you call the tenants ex-landlord and are told a horror story of destroyed property and late rent, then you can, of course, deny the tenant. You can even write the previous landlords statement on the rejection if you get permission to do so from the landlord, although this is not always a good idea.
A couple of things to keep in mind are that you should always provide a list of screening criteria to potential tenants before they come in for an interview to save time. If you need tenants who do not have pets and who make over a certain income, or who do not play musical instruments, then you have to say so before they come in. This can save you a lot of legal hassle should you deny tenants for one of these reasons.
It is also important to keep in mind that you should provide tenants with an adverse action notice, which informs the tenant that they have been denied. Some credit report companies even require you to include an adverse action notice with a copy of the credit report and a notice that the credit report company in no way influenced the decision to deny the tenant. When you decide to deny a tenant, sending an adverse action notice with a full explanation allows you to steer clear of fair housing disputes should the tenant choose to fight your decision. If you have clearly listed a reason for denial that is on your contract, then they cannot file a suit against you. If you have not, and have not provided a reason for denial, then you can have significantly more trouble.
The easiest way to ensure that everyone denied as a tenant is done so under fair and legal grounds is to let a professional Issaquah property management company handle the screening for you. Importantly, they will also do the rest of the work, including marketing for good tenants, maintenance, handling tenants over time, and even handling repairs.
