TIP OF THE MONTH - August 2011
Permissible Tenant Selection Criteria
Source: Essential Facts of Real Estate Management
Joseph DeCarlo & Crossett Real Estate Services
Tenants, property owners and managers may use any criteria or
guidelines that do not discriminate against the protected classes.
Income and ability to pay.
The law does not guarantee a person a right to rent property that he or
she cannot afford. Property owners and managers may, therefore,
establish reasonable guidelines to assess the prospective Tenant’s
ability to pay.
owner may require that the rent not exceed 30/35 percent of a
residential applicant’s income. In assessing the prospective Tenant’s
ability to pay, the property owner must consider ALL income that the
Tenant has a reasonable expectation of collecting in the future.
This may include welfare, social security/disability income, child
support, pensions, dividends, etc.
The property owner may assess the Tenant’s credit history and reject
any Tenant whose history shows late payments, prior evictions,
bankruptcy, overdue credit card payments, or other evidence of lack of
creditworthiness. Computerized credit reports may be obtained
through credit bureaus, local apartment associations, or associations
of realtors. A release of information form must be signed by the
prospective Tenant (s) for permission to obtain a credit history or
History of violence or destructiveness.
Past instances of violence or destructiveness may be considered in
assessing a residential Tenant'’ ability to coexist peacefully with
other Tenants or neighbors.
(Employment history/prior rental history is very helpful)
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This web page was updated on 07/29/2011.