Government Could Restrict Landlords' Use of Criminal Background Information

By Michael Klazema on 4/21/2016

The United States Department of Housing and Urban Development (or HUD) wants to crack down on landlords for the use of criminal background checks in housing applicant screenings. Under a pending set of rules, HUD would reportedly be more adamant about flagging and punishing landlords for fair housing violations. Specifically, in regards to background checks, landlords could land in big trouble for dismissing housing applicants summarily due to felony status or using arrest records as a means to reject applications.

Some are worried that HUD's new rules are part of a social justice crusade and limit the freedoms of American business people. In an article published by, for instance, the deputy director of the Texas Public Policy Foundation's Right on Crime Center noted that felons are "not a protected class" and argued that HUD was more worried about "the stigma of past criminal offence than public safety."

However, while felons aren't a protected class, HUD's argument is that background checks and the decisions landlords make because of them have a disproportionate impact on minority groups—specifically African-Americans. If this argument sounds familiar, it's because the Equal Employment Opportunity Commission has made them before in regards to background checks used for employment purposes.

In many ways, HUD's proposed "guidance" on the housing background check issue is identical to the EEOC's current guidance on employment background checks. Just like the EEOC, HUD would bar landlords from taking arrest records into account when judging housing applications. This move makes sense: arrests are not a sign of criminal guilt and should not have any bearing on housing decisions. Without a conviction, an arrest cannot be taken as a prediction that a housing applicant is a threat to "public safety." Someone who was arrested but not convicted could have been wrongly accused and cleared of wrongdoing, or never charged with a crime at all.

Also like the EEOC, HUD doesn't want landlords tossing out applications of anyone who has a criminal conviction—or even anyone who has a felony charge. Instead, the department says that landlords must prove their policies for barring applicants are "necessary to achieve a substantial, legitimate, nondiscriminatory interest."

In other words, if a landlord wants to bar an applicant for a criminal conviction, the landlord must have a strong argument for why the applicant might pose a threat. For instance, a convicted murderer or rapist might be dangerous to other tenants or the nearby community. In essence, landlords would have to decide on a conviction-by-conviction basis to determine whether or not they had a "legitimate, nondiscriminatory" reason to bar a housing applicant based on criminal history.

HUD's rules are not yet final. Stay tuned to learn more about these background check-related developments in the housing industry.


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