So they rent, which raises all manner of questions. Who\u2019s renting to these undocumented immigrants? What kinds of tenants are they? Are landlords even allowed to knowingly sign leases with them? What risks do they pose, and why would landlords lease to them?<\/p>\n
Because of the undocumented nature of these renters, some of the evidence is, necessarily, anecdotal. But where government statistics are scarce, we\u2019ll apply single-step logic, anecdotal evidence and common sense. What we won’t<\/em> apply is politics, so check them at the door and read on.<\/p>\n That, dear readers, depends entirely on where your property is.<\/p>\n State laws range from emphatically pro-immigrant to aggressively anti-immigrant. Consider California and New York, where it\u2019s not legal to even ask a rental applicant about their residency status.<\/p>\n On the opposite end of the legal spectrum, it\u2019s a felony in Oklahoma for landlords and property managers to provide housing to undocumented immigrants<\/a>. The law is pretty explicit: \u201cIt shall be unlawful for any person to conceal, harbor, or shelter from detection any alien in any place within the State of Oklahoma, including any building.\u201d<\/p>\n Double check your state\u2019s laws because a wrong move in either direction could land you in court depending on your state\u2019s leanings.<\/p>\n The Department of Housing and Urban Development (HUD) does not have a sense of humor or leniency when it comes to Fair Housing laws.<\/p>\n Quite the opposite: They\u2019ve been aggressively pursuing Fair Housing lawsuits in recent years<\/a>, trying to make examples of landlords around the country.<\/p>\n As a refresher, landlords and property managers cannot discriminate on the basis of race, national origin, or ethnicity (among other factors less relevant to immigration). But it turns out that “discrimination” is not so easy to define. For example, earlier this year HUD issued a ruling that landlords cannot have a blanket policy barring all applicants with a criminal record<\/a>. The logic? That it violates Fair Housing laws based on race.<\/p>\n Related:<\/strong> The 5 Areas Where People Violate the Fair Housing Act The Most (And How to Avoid Them!)<\/a><\/em><\/p>\n Gray areas in HUD\u2019s interpretation of the laws abound. If you only post rental ads in English on a community board frequented by white Americans, but the city has a large Hispanic population, is that discrimination? If you require all rental applicants to pass an identity verification, is that discrimination?<\/p>\n But here are a few rules that are crystal clear, black and white: If you require certain documentation of one rental applicant, you must require it of all applicants. If you run certain background checks on one applicant, you must run the same checks on all applicants. There is no room for different requests, documents, or screening actions.<\/p>\n Have a comprehensive tenant screening procedure, and stick to it for every applicant. No exceptions.<\/p>\n Captain Obvious here: Undocumented immigrants are not documented on paper<\/em>.<\/p>\n That means no credit report, no criminal background, no eviction history — at least theoretically. Sometimes there is a paper trail, using a false identity and Social Security Number.<\/p>\n So how can you know as a landlord or property manager if the applicant will make a good tenant or not? In many ways, it\u2019s like leasing to a recent graduate, with no credit history or track record. One option is requiring a co-signer if you have an applicant who\u00a0seems promising based on income, employment and housing history, but has little or no credit.<\/p>\n The language barrier can pose another challenge. Many undocumented immigrants have limited or no English, which means you\u2019ll need a translator if you don\u2019t speak their native language.<\/p>\n And what of the lease agreement? In some states (e.g. California), landlords are legally required to provide a copy of the lease in whatever language was used to negotiate lease terms<\/a>. Do you know where to get a California lease in Lithuanian? I don\u2019t. That means hiring a translator to draft a copy of your lease in your tenant\u2019s language.<\/p>\n Lastly, there are plenty of anecdotal accounts of undocumented immigrants packing many occupants into one rental unit. It makes intuitive sense, for several reasons. First, it is more difficult for undocumented immigrants to find housing, with no papers and no background on paper. Second, undocumented immigrants earn less income than legal residents<\/a>, given the fewer job options available with no papers.<\/p>\n More occupants mean more wear and tear on the property — and higher repair and replacement costs for landlords.<\/p>\n Here\u2019s a conundrum: If you leased to an undocumented immigrant in a state where it is a crime to do so, what happens if you need to evict that tenant? How readily would you file in court for eviction?<\/p>\n Or, in states where it\u2019s not a crime to lease to undocumented immigrants, how do you collect unpaid rent or damages from someone who doesn\u2019t exist on paper?<\/p>\n Brian Pendergraft, lead attorney and landlord-tenant specialist at The Pendergraft Firm<\/a>, explains further: \u201cIf I get a judgment against an American citizen for unpaid rent, then I can find where they work and garnish their paycheck, find where they bank and garnish their account, and use every tool in the toolbox to go after their assets. And it is hard enough to collect a judgment from an American citizen.\u201d<\/p>\n But undocumented immigrants? \u201cThe problem with renting to undocumented immigrants is that if they do not pay rent, chances are they are \u2018judgment proof.\u2019\u201d<\/p>\n With all these challenges, why would any landlord take the risk on undocumented immigrants?<\/p>\n It turns out there are some compelling reasons.<\/p>\n First, undocumented immigrants don\u2019t want to rock the boat. The last place they want to end up is a courtroom, which means they\u2019re more likely to pay the rent. And because there tend to be more occupants in the rental unit, there are more income earners to cover rent payments if one occupant loses their job.<\/p>\n If the tenants did default on the rent, they aren\u2019t likely to stick around for the eviction process<\/a>. The last thing they want is appearances on court dockets, sheriffs showing up at the door, etc. This\u00a0means they\u2019re likely to \u201cskip\u201d and simply move out without forcing you to go through the entire expensive, time-consuming eviction process. They\u2019re also far less likely to sue you, for the same reasons. There\u2019s nothing worse for landlords\u2019 returns than a lawsuit.<\/p>\n And you know those tenants who are constantly calling you to complain and demand property upgrades and improvements? Undocumented immigrants aren\u2019t exactly keen to have a bunch of contractors and strangers tromping through the property all the time. Anecdotal evidence is that undocumented immigrant tenants minimize their contact with the landlord and will even make minor repairs themselves when something breaks.<\/p>\n Finally, some landlords report that undocumented immigrants will stay in the property longer than typical tenants because of the difficulty posed by finding new housing without papers. Longer tenancies mean lower turnover rates — great news, because turnovers are deadly to landlords\u2019 returns.<\/p>\n Should you rent to undocumented immigrants? Maybe. Understand your state\u2019s laws, explore your market\u2019s demographics, decide what your priorities are as a landlord. There are risks that come with renting to undocumented immigrants, but there can also be benefits, especially for hands-off landlords looking to create rental income that\u2019s more passive<\/a>.<\/p>\nFirst of all, is it even legal to rent to undocumented immigrants?<\/h2>\n
![\"owner-occupied-financing\"](\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2016\/11\/owner-occupied-financing.jpg\" "\\"\\"")
<\/p>\nFair Housing laws get tricky when immigrants are involved.<\/h2>\n
What are the challenges in screening &\u00a0leasing to undocumented immigrants?<\/h2>\n
![\"botched-eviction\"](\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2016\/09\/botched-eviction.jpg\" "\\"\\"")
<\/p>\nWhat are the challenges in evicting &\u00a0collecting if undocumented immigrant tenants don\u2019t perform?<\/h2>\n
What are the benefits to renting to undocumented immigrants?<\/h2>\n
\n
\nRelated:<\/strong> 7 Advanced Tenant Screening Tips (So You\u2019re Not Fooled by Wolves in Sheep\u2019s Clothing)<\/a><\/em><\/p>\n
![\"\"](\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2017\/08\/blog_ads-02.jpg\" "\\"\\"")
<\/a><\/p>\n