Landlords Sued For Refusing To Rent To Felons

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On May 20, 2019, a landlord in Orlando was negotiating with a potential renter who mentioned he had a felony conviction on his record. Upon hearing this, the landlord instantly turned down the application, stating that he “does not rent to felons.” A few days later, the potential client sued the landlord for discrimination.

Nothing in the Fair Housing Act specifically denies landlords the right to reject an applicant based on a prior conviction for a felony. However, a blanket policy to reject applications from felons can have an indirect impact on minority populations, which led the U.S. Department of Housing and Urban Development (or HUD) to issue a statement in the year 2016 regarding criminal backgrounds.

According to a study by the University of Georgia, approximately 8% of American citizens have felony convictions on their records. However, according to the same study, in the African-American community, the percentage increases to 23% and 33% percent for adult males specifically. In part, this higher percentage results from an anti-drug restriction made roughly 30 years ago that specifically focused on low-income communities.

The HUD reasons that because some minority communities have a considerably higher percentage of members with a felony conviction on their records, a blanket policy not to rent to convicted felons has a disparate impact on minorities. This essentially means that this “disparate impact” caused by having a blanket policy against felony convictions clearly violates the Fair Housing Act, according to the HUD.

Here are a few things to consider when developing an in-house rental policy for your real estate business:

Impact

Does the policy have a disparate impact? This is defined as an action that, although it may not discriminate against a specific applicant, it may still affect a specific group protected under the Fair Housing Act. Does the policy have a distinct impact on a specific community because of national origin or their race? Although the HUD understands this is fact specific, it takes into account several Department of Justice statistics showing that blanket denials in the United States based on criminal history have a greater impact on African Americans and Hispanics than any other community.

Justification

A property owner must be able to show that the policy is justified, which the HUD defines as a policy that is “necessary to achieve a substantial, legitimate, nondiscriminatory interest.” This means that the policy cannot be hypothetical or speculative; there must be evidence that supports the policy. While the HUD may take into account the protection of other residents’ safety and their property, the property owner must prove through solid evidence that the policy was designed to serve that purpose.

Are There Other Options Available?

Is there an alternative to this type of policy available? This depends on the specific details of the applicant’s background. However, the HUD will consider the length of time that has passed since an applicant was convicted, the specific circumstances surrounding the criminal conduct, and a good tenant rental history either before or after the conviction.

Recommendations for Landlords in Florida

• Create a written policy that contains detailed standards on how to evaluate individuals on a case-by-case basis.
• Document all research done and decisions made on applicants and review this information periodically to make sure the policy is:
  • Being properly followed, and
  • Not having a discriminatory effect.
• Take your time to evaluate an individual’s criminal record. This will help avoid any unintended discriminatory effect.
• Do not reject applications based on prior arrests that did not result in a felony conviction.
• Make sure to remove application questions that specifically ask about arrests that did not result in convictions.
• Always make sure to evaluate applicants on a case-by-case basis.
• Do not apply policies or practices against criminal records in an inconsistent manner. This may result in a claim of intentional discrimination filed against you by an unhappy applicant.

If you are a landlord in Florida who has been sued for discrimination or are looking to create detailed policies for your real estate business, contact Jurado & Farshchian, P.L. today – we can help you.
Call us today at (305) 921-0440 or send us an email to [email protected] to get started.

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