Why do we now have to have a Rental Criteria and provide it to all applicants?

All Property Managers and Landlords should screen applicants before turning over their rental property to them. A good application process and a good screening policy can eliminate probably 90% of problems that often come with being in the rental business. So this new law will affect almost all LLA members and Rental Review readers.

Washington State Senate Bill 6315 says that if you use tenant screening and/or consumer reports, you must comply with this bill, and it went into effect June 7, 2012. This new law is intended to provide applicants with more information up front when deciding whether or not to actually submit an application for your vacancy and before paying the tenant screening fee.

The problem this is hoping to solve is that landlords and property managers spend hours, even days, checking references, rental histories and credit histories, only to discover that an applicant does not meet the required qualifications. A landlord may have assumed that applicants knew that a bankruptcy, an eviction, or criminal history would disqualify them. The words “common sense” are often used to explain why landlords don’t spell out in writing what they think everyone already knows. But applicants often go to a small landlord or a small property management company specifically because they are looking for or hoping for a more “flexible” screening process or more lenient acceptance policy. Some tenants specifically report that is the MAIN reason they search out a small landlords – because their rental history or credit history is too sketchy or too damaged to apply for tenancy at the “bigger” places. Letting applicants know what is required to successfully have their application accepted can save landlords hours of wasted time.

The second problem that this law hope to solve is that many applicants contend that they can spend as much as a half month’s rent just is application/screening fees because with a small landlord with only 1 or 2 vacancies, they may be competing with a dozen or more applicants for each vacancy and only one person can move in, the result being that the other eleven applicants have wasted their application fees. And when inquiring why they were in the group that was turned away, they are told that there was some unknown requirement or criteria they did not meet. For instance, if they had known that there was an income requirement for 3 times the monthly rent instead of say, 2 ½ times the monthly rent, they would not have spent the money for screening. Saving application fees allows them to put more money toward the first month’s rent and/or security deposit.

The changes that went into effect June 7th, 2012 are these:

1. Prior to obtaining any information about a prospective tenant, the landlord or property manager is required to first notify the prospective tenant in writing of the following:

  • The type of information that will be accessed in the screening (credit, public records, criminal, rental history, etc.)
  • The criteria should list what could result in denial of the application. This can also be called your Resident Acceptance Policy, as well as the more common Rental Criteria or Screening Criteria.
  • If a consumer report is used, the name and address of the consumer reporting agency and the prospective tenant’s right to obtain a free copy of the consumer report in the event of a denial or other adverse action, and to dispute the accuracy of information appearing in the consumer report.

2. The landlord may charge a prospective tenant for costs incurred in obtaining a tenant screening report only if the landlord provides the information listed above.

3. If a prospective landlord takes an adverse action, the landlord must provide a written notice of the adverse action to the applicant that states the reasons for that adverse action. Non-compliance could result in a $100 fine plus court costs and reasonable attorneys’ fees. To review Senate Bill 6315 go to http:/apps.leg.wa.gov/billinfo and type in 6315.

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