Anaheim Property Management Blog

We manage a new property and it was vacant. We received an application from prospective tenants and they seemed to be the "perfect" renters: FICO scores in excess of 800, over $100,000 in the bank, verifiable income 4 times the monthly rent, and they were an older husband and wife with no children. We recommended to the owner that they accept the applicants and allow them to lease the property. The owner wanted to think about it overnight. No problem. The next day the owner calls and decides to pass on the applicants. When pressed for the reason to decline them she volunteered that she had googled the applicants and discovered that their son, who lives out of state, was a registered sex offender. Since he doesn't live with the applicants, we thought this was a bit harsh and she should still go with these applicants. She refused. We then called the agent who represented the tenants, and he demanded a reason for the decline. That created a problem. We legally must apply the same guidelines to all applicants. If their credit had been less than stellar, we could have provided an "adverse action" notice and a copy of the credit report. If their income were insufficient, we could show them that we require 3 times the rent in verified rent as part of our company policy. But to deny their application for the sins of their son would not hold up in a court of law. We were able to talk our owner into accepting the application and avoid this potential litigation. If you deny an applicant for the wrong reason, or discriminate against a protected class, you could be violating federal law and find yourself in deep water. A competent and professional property management company with have written guidelines and an ability to show an interested party that all applicants were treated equally. In many cases we help owners stay in compliance with the law and guide them in the right direction when it comes to accepting, or denying, potential tenants.