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HUD’s New Criminal Background Guidelines in Minnesota

HUD’s New Criminal Background Guidelines in Minnesota

August 24, 2016

New HUD guidelines are making it easier for those with a criminal record to find housing.

But while this may be good news for some, it’s left landlords and property management companies alike scratching their heads, and wondering what exactly it means for both them and their properties.  

According to the new guidelines from the US Department of Housing and Urban Development (HUD) that were announced April 4, 2016, landlords are advised not to implement screening policies that would disqualify potential tenants solely on the basis of a criminal background. Doing so could be considered a violation the Fair Housing Act.

The Fair Housing Act –signed in 1968, prohibits housing discrimination on the basis of race, color, religion, sex, or national origin. Criminal history is not a protected status; however, according to the new HUD guidelines, turning down a tenant solely because of a criminal record can’t be legally justified.

These changes are made in an effort to reduce the disparate impact that sweeping bans can have. Since African Americans and Latinos are incarcerated at disproportionately high rates, blanket policies –such as a ban on anyone who’s ever had a brush with the law, will be more likely to exclude them from renting.

As many as 100 million U.S. adults, or nearly one-third of the population –have a criminal record of some sort, the HUD guidelines note –and the fact is that not every criminal has a lengthy past. Additionally, for some, simply being arrested for a crime may not have led to a conviction. In other cases, the individual may have been out of jail for decades, but still have their past to contend with and are having a hard time finding a place to call home.

President and CEO of the Fortune Society, JoAnne Page touches on the impact of being unable to find housing. “We know that if a person does not have a stable, affordable place to live, being a contributing member of society is extremely difficult,” she says.  

So just what does all of this mean for landlords? For many, it will mean adjusting their screening policies to ensure that they’re in compliance with the new guidelines, namely, that you can’t use a criminal past to automatically disqualify an applicant. Instead, you’ll want to carefully evaluate applications on a case-by-case basis.

HUD Guidelines and the Tenant Screening Process

With the new HUD guidance in effect, the question on every landlord’s mind is how can they screen applicants in compliance with the law?  

To uphold these guidelines, landlords will need to be more thorough when it comes to documenting the reasons that they deny an applicant. You’ll also want to ensure that your approval criteria as they pertain to an applicant’s criminal history, are supported by a “legally sufficient justification,” attorney Denny Dobbins explains. But the good news is that employers have been taking most of these steps for years, and it shouldn’t be too difficult for landlords to comply with these new guidelines –as daunting as they may sound.

Here are a few things you’ll want to pay special attention to when adjusting your tenant screening policies.

Arrests

Do not exclude applicants because of an arrest record alone. Arrests don’t always lead to convictions.

According to HUD, “…a housing provider who denies housing to persons on the basis of arrests not resulting in conviction cannot prove that the exclusion actually assists in protecting resident safety and/or property.”

In situations where an arrest has led to an open case that’s being litigated, it may be best to consult with your attorney.

Prior Convictions

Avoid creating blanket policies such as, “Applicants with criminal convictions will be denied.”

While the HUD doesn’t draw clear lines outing specific convictions that landlords can use to disqualify a tenant from renting, they do allow for one exception: “A Landlord may discriminate for a conviction for illegal manufacture or distribution of a controlled substance as set forth in 21 U.S.C. 802.”

Every other conviction, however, requires a case-by-case assessment, but as HUD says: “Bald assertions based on generalization or stereotype” aren’t sufficient.

Time Elapsed Since Conviction

When processing applications, the amount of time that’s passed since the conviction occurred should also be taken into consideration.

Although HUD has not provided what sort of timeline is reasonable for felonies or misdemeanors, some have suggested a look back period of six or seven years for certain felonies or high-risk crimes. It’s worth noting that HUD has relied on a study that supports the proposition that after six or seven years, the risk of new offenses by a person with a prior criminal history is low –and after this time it starts to approximate those who have no criminal record at all.

Nature of the Crime

Finally, landlords must balance out their nondiscriminatory screening policies, with their duty to ensure resident and property safety.

HUD indicates on its website that when it comes to public housing authorities, a criminal background investigation must be performed to determine lifetime registered sex offenders that then may be precluded. It follows then, that registered sex offenders may be able to be disqualified, but again, HUD’s new guidelines aren’t clear.

“The nature and gravity of a sex crime may be so serious that even the slightest amount of risk may be too much when contemplating the protection of your substantial and legitimate interest(s),” advises Denny Dobbins, attorney. “A case-by-case evaluation based on the facts is necessary for how long to prohibit residency for those with a sex crime who do not have a lifetime sex offender registration status.”

In cases where you are uncertain, it’s best to consult with your attorney.

Practical Pointers

While many assume that the HUD guidelines only apply to those with federally subsidized housing and public housing, this change impacts all landlords.

Here are some practical tips that can help you to create an efficient, thorough screening process that’s in compliance with the new guidelines.

Run Criminal Background Checks Last

To avoid the over reliance on criminal background checks, consider running them last after the applicants have passed credit checks, employment checks, past rental history, and other screening criteria. This will help to save time when processing applications, and helps the landlord to avoid actions that may be considered discriminatory.

Avoid Discriminatory Screening Questions

Asking questions that run the risk of being considered discriminatory, such as, “Have you ever been, at any point, convicted of a crime?” and instead asking more relevant questions, such as “Have you been convicted of a crime in the last seven years, or have you been released from custody within the last seven years?” may be a better alternative. This type of inquiry will help to bring the issue directly into a discussion about elapsed time, rather than suggesting that the landlord will deny an applicant automatically, based on a blanket ban on anyone with a criminal history.

Accept Proof of Mitigating Circumstances

Consider asking all applicants to provide proof of mitigating circumstances at the time of the crime, when they submit their application, or welcome proof of rehabilitation or evidence of social programs. Accepting this type of information is a step in the right direction, as it shows that you are not imposing an outright ban on applicants with a criminal history.

Of course, like all new policies, there are some wrinkles that will need to be ironed out, but that doesn’t mean you are exempt from following the guidelines that are in place.

For landlords, now is a good time to tighten up your tenant screening policies to make sure you’re not inadvertently discriminating against potential tenants. Getting rid of sweeping statements that disqualify applicants with a criminal background, and instead instituting a policy that allows for a case-by-case analysis is the best way to protect yourself.

Finally, make sure you have a good look at the new HUD guidelines for yourself, and consider enlisting the services of an attorney to help you go over this section in your screening policy to make sure you’re in the clear.

Landlords: what are your thoughts on the new HUD guidelines?

Photo Credit: Good Free Photos