How to Best Choose Tenant from Multiple Qualified Applicants (apartment, leases, renter)

[Squirl]

Promise to find references but just don't have time right now! sorry.......

[volk2k]

Originally Posted by DowntownVentura
Is renting to the first qualified applicant an actual Fair Housing law or is it just a guideline you (and others?) are recommending to avoid any issues of discrimination?

Originally Posted by Squirl

It is actual law...... LL's should always date and timestamp each application and limit applications they are willing to take.

Sorry to bump this up.... but did anyone actually verify whether or not this is a law?

My searches are finding that it is not a law, but rather a best practice to remove ambiguity and CYA.

[Squirl]

I googled around and actually couldn't find anything saying landlords are REQUIRED to lease to the first qualified applicant. So, it may be best practice since by not renting to the first qualified applicant the risk of having to deal with a FHS complaint is high.

[Koale]

I'm interested how any applicant would know if they are the first or the fiftieth applicant for any rental and why it is even an issue to have to disclose that info to any of them? It will always boil down to the fact the
any rental will be given to the applicant that the LL wishes to rent to.
Koale

[Squirl]

I have been a LL for a long time. I have told people who were interested that I leased to someone else and they contacted the city housing board complaining they were interested first and I rejected them in favor of someone else based on their marital status and race. Since I never accepted an application from them, nor did I even show them the place (yes, they did email about the place but I never made an appointment to show them the place) I was then instructed by the housing commission that I will always be protected by leasing to the first qualified applicants and I should indicate both date and time applications are submitted. There are people who simply out to win settlements and will follow your screening process in hopes of finding you vulnerable ......

[volk2k]

Originally Posted by Koale

I'm interested how any applicant would know if they are the first or the fiftieth applicant for any rental and why it is even an issue to have to disclose that info to any of them? It will always boil down to the fact the
any rental will be given to the applicant that the LL wishes to rent to.
Koale

I don't think it is a matter of an applicant finding out or not.... but rather a good defense that you are not breaking any fair housing laws...

There's no need to disclose this to an applicant... but it may help to limit a potential suit.

"Your honor, I accepted the FIRST qualified candidate. There is no discrimination here."

I just wanted to verify that this was a law or not.... Looks like it is not....

[jamies]

I see this bumped up again. Yes, I too can't find any reference to actual law. However it's pretty easy to legally disqualify anyone you don't want as a tenant in favor of someone better suited.

Besides why would you NOT want to rent to someone you couldn't find anything to disqualify them for. I'd LOVE to have that problem. My problem is getting multiple applicants and each one is worse than the other. It's not a matter of finding the best, but the least horrible.

[purehuman]

Can't you just rent to whoeever you figure will be a good tenant?...and just tell the others sorry, the place is now taken??..........A friend of ours used to rent a house out, and he would always arrange to meet a propective tenant at THEIR home....he felt that afforded him the oppurtunity to see how the tenants kept up their currant place before he rented them his.

[zz4guy]

Whoever gives you the deposit money first gets it first. That's how I do it. I had one gal pay a half month early just to be sure she got the place.

[jsenocak]

Originally Posted by KonaKat

Do you have a Fair Housing law handbook? If not, you need to read one. First qualified applicant is who gets the rental. So the first person who turned in an application who ended up being qualified according to your policies (which are equally extended to all applicants) is the one you choose. Vibes, however accurate, can land you in court for discrimination.

Every landlord should understand the laws of landlord/tenant and Fair Housing as they apply to them before they start being a landlord. Some states also have laws that "add" to the Federal Fair Housing laws and a good rule of thumb is always follow the law that most protects the applicant.

Originally Posted by Squirl

It is actual law...... LL's should always date and timestamp each application and limit applications they are willing to take.

I am always amazed at how often landlords, property managers, and real estate agents quote laws when they have no idea what the laws actually say! (Which is pretty pathetic, since some of us are actually required to take Fair Housing classes regularly!)

No, you absolutely DO NOT have to accept the first person who applies. You do however need to be ready to defend in court your reason for rejecting that person. If you are trying to decide between two qualified applicants, rate them! For instance, Zillow recently put out a free ebook which includes an Applicant Qualification Checklist that allows a landlord to score applicants based on income, credit, rental history, etc... Google "Zillow Lead Qualification Kit" and you'll find the ebook. This checklist is Appendix C.

Also, to help clear the air about SPECIFICALLY what the Fair Housing Act does and does not say, here is a link to the Department of Justice website so you can review the law yourself:
[url=http://www.justice.gov/crt/about/hce/title8.php]Civil Rights Division Home Page[/url]

Here is another interesting tidbit of information that is never discussed on these posts... Look at Section 803. [42 USC 3603] (b) - this paragraph outlines the EXEMPTIONS to the Fair Housing Act.

Basically, an owner (landlord) is exempt from the Fair Housing laws if they do not own more than 3 single-family rental units at one time and the rentals are being rented out without the services of a real estate licensee. Additionally, owner-occupied properties with no more than 4 units is also exempt.

What this means is that if you own 3 or fewer rental properties (either single-family homes, or individual apartments... don't get confused about what they are referring to as "single-family"!), or if you rent out rooms in your own occupied home, or if you own a building with 4 or fewer individual units and you live in one and rent out the others, you are exempt from Fair Housing.

What this exemption does is put a little bit of the decision-making and control back into the hands of small landlords with only a couple properties, and I think it's mostly a financial thing... For instance, as an example: You own one rental property. You are not making a fortune off that property, so you really cannot afford the expenses of vacancy, non-payment of rent, damages, etc... So, in that position, it may seem less risky to you to have a single person without kids (less wear & tear for you to be responsible for), or an older, more responsible and stable person (less turnover and risk of non-payment). If you owned several properties, it would be against Fair Housing and illegal to choose a tenant based on those preferences, but as a small landlord, it is NOT. However, NO ONE is exempt from discrimination based on race- keep that in mind! Also remember that this is the FEDERAL Fair Housing Act- each state, and even counties & municipalities, have their own laws. It's also important to be familiar with your local laws.

Just to give a little background on who I am: I'm a licensed REALTOR in the state of Maryland, and I am also a landlord- I own a rental apartment in Washington DC, and also rent out a room in my home in Maryland.