Rental Application
The rental application is a significant document between landlord and potential tenant. By completing the application, the applicant signifies his interest and intent to fill the vacancy if he, the applicant, is selected for tenancy. The applicant, by submitting his application, acknowledges and consents to the landlord’s stated tenant screening practices. The landlord by accepting the application commits to perform according to the stated rental policies in compliance with anti-discrimination laws, applicant consumer rights and the safety and security of the applicant’s personal information.
While there is an understanding between landlord and applicant, a submitted application is not a lease contract. A landlord is not obligated to offer tenancy to an applicant upon application submission nor is an applicant obligated to accept a landlord’s offer of tenancy at time of application submission. The landlord’s application process must be followed in its entirety until all applicants are screened and evaluated according to the landlord’s stated rental criteria.
Regardless of how well-qualified the applicant seems to be, how well an applicant presents himself, or how urgent the need to fill the vacancy, a landlord should not deviate from his rental standards. The vacancy should never be filled with an applicant who has not been tenant screened and has satisfactorily met the landlord’s rental criteria. Once an applicant has been allowed access to the rental unit either by transfer of keys or storage of personal items in the rental unit, the applicant immediately becomes a tenant. It will require legal eviction to remove the tenant from the premises and restore possession of the unit to the landlord.
A best business practice is to accept all requests for application and process the applications according to stated rental practices. By pre-screening responses to an advertised rental listing, a landlord can provide details of the application process and required screenings to interested prospects. Prospects can self-evaluate whether they believe they can qualify to rental standards and then proceed accordingly in their search for rental housing.
A prospect’s decision to submit an application is a voluntary action. A landlord should not make an arbitrary decision to accept an application or refuse to take an application. By refusing to accept an application, unless there is a valid business reason, such as insufficient income to meet the income to rent ratio, a landlord can open himself to claims of discrimination or create an emotionally charged situation whereby all parties may later regret their actions. Determination of qualification under rental standards should be conducted after all applications have been submitted within a specific time period.
A rental application allows a landlord to collect and organize applicant supplied information. A landlord must request sufficient information to adequately screen the applicant for business risk. As a general rule, a landlord can request any information that would objectively point to the applicant’s ability to pay timely rent and comply with lease terms and conditions. A valid information request could require copies of the applicant’s pay stubs and bank account statements, as well as credit reports and background checks, verification of previous rental housing history, employment verification, and landlord references. A recognized business necessity compliant with applicable laws is the underlying requirement for permissible purpose to require verifications and documentation.
If a prospect or an applicant is reluctant to provide requested information or refuses to provide information on the basis of an individual’s right to privacy, a landlord should explain that the request for information is a legitimate business purpose required for risk assessment to protect the landlord’s business and the safety and security of the current tenants. A landlord can assure the prospect/applicant that the landlord has the obligation and duty to safeguard the information collected on the application form and the screening reports and use the information for permissible purposes only. If the applicant declines to provide his personal information, a landlord may reject the application on the basis that the applicant did not meet rental criteria.
The most efficient means to obtain information needed to adequately screen an applicant while safeguarding the business income property and the safety of others is use of the application form. Data fields on the application form are the landlord’s request for information. An interview may be used to request additional information or clarify information as needed. The application form does not replace an applicant interview. An applicant interview is a separate screening tool. It is the landlord’s decision how to structure the application process.
The information requested on the application form should be business related to the qualifying of an applicant for rental housing. The same information should be requested of every applicant, the same screenings conducted on every applicant, and the same analysis performed on screening reports of every applicant. There can be no selectivity or preferential treatment of one applicant over another.
During the application process there will be discussion between landlord and applicant. There may be questions regarding the property or questions about information requested or information supplied. A landlord should be thoroughly familiar with fair housing laws at every level in order to understand what questions may be asked and what questions should not be asked of an applicant. Questions that violate the rights of protected classes violate fair housing laws cannot asked. Federal Fair Housing laws prohibit discrimination against the protected classes of race, religion, national origin, sex, color, familial status, or disability. State and local fair housing laws may have additional protected classes and thus be more stringent than federal law.
Questions that are based upon sound business purpose and are legally permissible can help clarify applicant supplied information and supplement screening reports. However, questions, even those asked in friendly conversation, may not stray into issues that are legally protected rights of applicants and tenants.
For business protection it is a good idea to reserve a section on the application form marked for management use only. This section can contain the date and time the application was received, the property address, the rent amount quoted, deposits and fees quoted, receipt of deposits and fees paid at time of application, unit availability date, and requested move-in date. With the applicant’s signature on the application, the document serves as confirmation of any oral discussion regarding those issues discussed at time of application or that might have been discussed between landlord and potential applicant during a prior contact.
The value of the management section is the documentation of the relevant information quoted to the applicant at the time of application and the timeline of expected events during the application and screening process. A landlord should not leave himself vulnerable to a misunderstanding of terms and conditions of tenancy or rely upon the memory of either party as to details of any discussion of move-in requirements.
The information collected from an applicant imposes responsibility on the landlord not only to use the information in accordance with all laws, but to also safeguard that information throughout the length of the tenancy and during the required retention period following tenancy, and then to properly dispose of it when retention requirements have been met.
The application form is a risk assessment tool to collect as much relevant information about an applicant within the parameters of permissible purpose, business necessity, and legal rights. The application process properly conducted and documented can reduce the risk of claims of discrimination in screening and selection of applicants. The signed rental application and the tenant screening results support the landlord’s decision to offer tenancy to the selected applicant.