Acquiring and owning single-family rental properties can be a rewarding and fun investment. Unlike other types of investments, if you want to successfully go from a property owner to a landlord, there are several factors you need to consider. Suppose you are an Ivins rental property owner and are preparing to lease for the first time. Because of this, it is crucial to fully understand the basics of leasing strategies and, even more importantly, the laws that now apply to you and your renter. We’ve put up a comprehensive guide to get you started on leasing your first property. By obeying these simple guidelines, you can make your first experience a great one.
Renter Screening Process
One of the first and most significant things in leasing your rental property is locating the ideal renter. And the best method to do that is to have a good tenant screening process for each applicant. You’ll need to gather information from your prospective renter to help you determine whether they are the ones you’re in search of. At a minimum, encourage them to fill out an application that includes all intended home occupants’ names and birth dates (even those under 18), five years of employment history, and at least three past rental references. Moreover, you should take the Social Security numbers for all adult renters and conduct a background check on each one. Next, call and verify the information on their application. If possible, communicate with any previous landlords and get details on their renting history. Although it may take a while, the more research you perform before you sign that lease, the less likely you’ll get caught off guard in the future.
As you advertise to and screen renters, it’s crucial to avoid discriminating against potential renters, even if it’s by accident. Many federal laws make it unlawful to discriminate against a renter based on race, sex, color, national origin, religion, handicap, and familial status. These laws include:
- Fair Housing Act (FHA): The Fair Housing Act (FHA) is a federal law that prohibits discrimination in housing because of race, color, national origin, religion, sex, familial status, or disability. The FHA applies to all parts of the rental process, including advertising, tenant selection, and terms and conditions of tenancy.
- Americans with Disabilities Act (ADA): Also covered by FHA is a federal law that prohibits discrimination against individuals with disabilities. Landlords who own multi-unit buildings of 4 units or more are expected to make reasonable accommodations for those with disabilities, such as giving accessible parking spaces or placing grab bars in bathrooms.
- Age Discrimination in Employment Act (ADEA): The Age Discrimination in Employment Act (ADEA) is a federal law that bans discrimination against individuals 40 years of age or older. Although the ADEA was created to protect employees, it also prohibits discrimination in housing based on age.
- Equal Credit Opportunity Act (ECOA): The Equal Credit Opportunity Act (ECOA) is a federal law prohibiting discrimination in credit transactions, including rental transactions. Under the ECOA, landlords may not discriminate against individuals based on their race, color, national origin, religion, sex, marital status, age, or because they receive public assistance.
Aside from federal law, you should also research state and local law. There may be other protected classes depending on local regulations.
As you write your rental ads, avoid using language that could be taken as discrimination, such as saying you won’t rent to seniors or people with children or that you won’t rent to those who live on government assistance. Then, as you acquire applications and screen renters, fairly assess your applicants based on the information they provide and not on other criteria. By maintaining professionalism and adopting an unbiased screening system, you can stay away from discriminating against any potential renters.
Understanding Reasonable Accommodations
Similarly, it is crucial not to assume that someone with a disability is automatically not a fit candidate for your rental property. Under the Federal Fair Housing Act, Ivins property managers have to make “reasonable accommodations” for their renters, should they be needed. By definition, a reasonable accommodation is “a change, exception, or adjustment to a rule, policy, practice, or service that may be necessary for a person with a disability to have an equal opportunity to use and enjoy a dwelling.” If your prospective renter otherwise meets the criteria for renting your property, accommodation should not be a reason to decline them. The accommodation a renter requests would be paid for and installed by the renter, with the arrangement that they will send back the property to its original condition upon move-out.
Other accommodations include letting service and emotional support animals in the rental property, even if you have a strict policy against having pets. Service and emotional support animals are excluded from a rental pet policy. You may not charge additional rent or fees if a renter retains a service animal on the property.
It can be hard to know all the laws and best practices for leasing rental properties. Why not give this important job to a professional property manager? At Real Property Management Southern Utah, we provide clear and anti-discriminatory screening and leasing services to help our rental property owners locate the most qualified renters. Contact us today or call us at 435-673-4242 to learn more.
Originally published on June 4, 2021
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.