Need to Know!

April 5, 2016 2:24 pm

WA State Accepts Reusable (Portable) Tenant Screening Reports

The Washington State legislature has taken another small but meaningful step to encourage greater transparency in consumer reporting, and to reduce the burden associated with multiple screening fees borne primarily by low income individuals and families. It was only a few years ago that landlord interests and advocates came together to pass the Fair Tenant Screening Act – modifying RCW 59.18.257 to require (among other things) that landlords notify prospective tenants of what information will be accessed and what factors will result in denial of an application. Senate Bill 6413, passed unanimously by both chambers and signed by Governor Inslee, is impressive if for no other reason than it is the second time in the last few years when landlords and advocates actually came together (compromised) to make progress on this issue. What exactly is Senate Bill 6413? Requires landlords to say up front whether they accept  a comprehensive reusable (aka portable) tenant screening report – which is clearly defined in the bill.... View Article

March 15, 2016 1:01 pm

Tenant Screening 101 – “The Humble Application”

Thus far in our Tenant Screening 101 series, we’ve discussed… The importance of tenant screening Consumer reporting law (notably the Fair Credit Reporting Act) The elements of a comprehensive tenant screening report The importance of accuracy Screening prospective tenants on a first-come, first serve basis Now we focus on process, which begins with the application to rent. There is, of course, the traditional paper application – often a multi-part form ($$) – and there is the online equivalent.  The same rules (or best practices) apply. There is a tendency to discount information found in the application – since the source is the applicant themselves.  While there is merit to that view, we are struck by the candor of most – motivated perhaps by the knowledge that falsification will result in denial or termination of tenancy – and that the obligatory background check will be both thorough and accurate. Either way, the application is one of several... View Article

February 1, 2016 9:04 am

Tenant Screening – Criminal Records, A Barrier to Re-entry?

Mayor Ed Murray of Seattle recently formed an 18 member task force to explore and develop proposals to reduce barriers to housing faced by those with criminal records. I represent Moco Incorporated.  We are a Seattle-based consumer reporting agency specializing in tenant background checks.  We asked repeatedly to be granted a seat at the table.  Those requests were denied. My purpose here is to share the perspective of someone with considerable knowledge of the tenant screening space, hoping to bring some balance to the conversation. The Problem A study by VA New England (Homelessness in the state and federal prison system population) found that recent homelessness is 4-6 times greater among state and federal prison inmates than the general population.  A reasonable interpretation of the data is that the relationship between homelessness and criminal behavior is to a degree causal – that reducing barriers to housing (and homelessness) will have a favorable impact on recidivism. Complicating the search... View Article

January 19, 2016 3:24 pm

Tenant Screening 101 – “To Screen or Not to Screen”

This is the first in a series of posts focused on the fundamentals of tenant screening – information and advice for those who are new to residential property management, and those who have paid a price for what they didn’t know. “To Screen or Not to Screening” We are busy.  We (some of us, anyway) have an inflated sense of our ability to “read people”.  We  operate for years without a problem – reinforcing this flawed notion. Then it happens.  A serial evictee with a nice personality stops paying rent.  There is damage to the home.  Neighbors complain or move out. You come to your senses.  You issue notice.  You ask the resident to leave.  They blow you off.  You hire an attorney who files an unlawful detainer action with the courts.  Time passes.  The tenant moves out and the case is dismissed – since there is no hope of recovery.  Ouch! And then it dawns... View Article

January 13, 2016 12:32 pm

Tenant Screening 101- The Fundamentals

Following is a series of blog posts addressing the fundamentals of tenant screening – information and advice for those who are new to residential property management or those who may have paid a price for what they didn’t know. Syllabus  To Screen or Not to Screen Applicant Identification First Come-First Serve Report Content Report Accuracy Rental Criteria Rental References The Fair Credit Reporting Act Screening & Fair Housing Landlord & Tenant Law Forms – Leases & Notices

December 30, 2015 7:38 pm

Tenant Screening 101 – Rental Criteria

There has never been a more hostile legal and regulatory environment for landlords and tenant screening companies.  It is more important than ever, therefore, that we know what we are doing – that we take the proverbial high-road in our effort to strike a balance between carefully underwriting prospective tenants and minimizing the risk of legal and regulatory problems. Step 1 is to take the time necessary to develop, refine and formalize your rental criteria.  “How to Develop Landlord Rental Criteria” addresses the steps necessary to develop your criteria and the benefits associated with a consistent application of those criteria as part of the tenant screening process.  A Criteria Worksheet (including sample criteria document) is available at no charge under Landlord Resources on®. A critical step in developing criteria is deciding what is acceptable in terms of credit, rental history, criminal and eviction history, length of employment and income... View Article

December 29, 2015 11:56 am

Tenant Screening 101- Report Content

Tenant screening reports are a specialized type of “Consumer Report” as defined by the Fair Credit Reporting Act (FCRA). Tenant screening reports nearly always include: 1.  A consumer credit report – provided by one of the three national credit reporting agencies (Experian, Equifax and Transunion.  There was a time when some landlords opted for reports from all three bureaus – unnecessay today since most creditors report to all three. 2. An eviction search – a search of the public record for unlawful detainer claims against the applicant. 3.  A criminal records search – a search of the public record for evidence of criminal activity on the part of the applicant.  The criminal records search may also include a national sex offender registry search and the U.S. Treasury Department’s  Specially Designated Nations search (often referred to as an OFAC search). 4.  An Employment (income) verification – though landlords often rely on pay stubs these... View Article

December 2, 2015 12:46 am

Tenant Screening 101 – Accuracy, Why It Matters!

We’ve written at length about the importance of accuracy in tenant screening – devoting a ton of real estate to the applicable provisions in state and federal consumer reporting law – notably the Fair Credit Reporting Act (FCRA). We need to know the law, certainly, given the vigor with which regulators and trial lawyers pursue such claims.  But concentrating on the law sort of misses the point – that there is (arguably) an even better reason to concern ourselves with the accuracy of tenant screening reports. Accurate reports drive better decisions.  Better decisions are reflected in improved occupancy, resident profile, NOI and equity.  Accuracy in tenant screening implies two things.  First, the report is thorough.  Secondly, that which is reported is true! Public Records Perhaps the most common error in tenant screening is a failure to search the public record for AKA’s and additional addresses (disclosed or undisclosed). An equally common error... View Article

November 19, 2015 6:44 am

Tenant Screening 101 – Legal & Regulatory Environment

Landlords and tenant screening companies face an increasingly hostile legal and regulatory environment.  There is a large and growing body of law governing the production and use of tenant screening reports – a specialized form of consumer reports. Vigorous enforcement of the Fair Credit Reporting Act (FCRA) by the Consumer Financial Protection Bureau (CFPB) – created by the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) – has increased the risk associated with owning and managing rental properties. There is good news, however. By following a few simple rules – best practices – we can thoroughly vet prospective residents without becoming targets ourselves. Here’s how: Best Practices Develop your rental criteria before accepting applications to rent. Inform the applicant that a background check will be conducted as part of the leasing process.  Secure their authorization (in the form of a signature on an application containing the required disclosure and authorization language – as well as the name and contact information for the tenant screening company. Provide the... View Article

November 5, 2015 9:07 pm

Things to Consider before Applying for a Rental Home

There is a great deal written for landlords about screening prospective residents… much less written for applicants about screening prospective landlords.  So here goes. What is it you should consider before signing on the bottom line of a rental agreement. There are the obvious, of course: Is the property attractive & well maintained? Are there units (available) that meet your needs – bedrooms, bathrooms, appliances, etc? What amenities are included – exercise facilities, a pool, spa, etc? Is there adequate parking and access to transportation?   Less obvious but equally important, are the landlord’s “tenant screening” practices – notably their rental criteria. So what is rental “criteria” and why do you and I care? Rental criteria are the standards by which a landlord evaluates a prospective tenant – often a document outlining various thresholds the applicant must meet to be granted tenancy – as well as those things that will result in denial of the application. Criteria includes one or more of the... View Article