Once a tenant relationship exists, the landlord should follow a written policy describing the circumstances under which the landlord will be allowed to run an updated report on the tenant or his/her co-applicant. Sample triggers to include in a written policy relating to requesting an updated consumer report on a tenant or their co-applicant might include the following:
- Renewal of a fixed term lease for a period greater than one month.
- Default in the payment of rent for a period of more than ten days.
- Occurrence of damage to the rental unit reasonably suspected to be in excess of the security deposit.
- Occurrence of or suspected occurrence of behavior that the landlord has reason to believe is of a criminal, illegal, dangerous, or other behavior inconsistent with the rules and requirements of the property or unit. And could give rise to injury of another person or damage to property located on the premises of the landlord.
- Initiation of a legal proceeding arising out of the rental agreement.
- Vacation of the rental unit with money owing.
In addition to considering the FCRA and state consumer rights laws, the landlord should evaluate state privacy laws in formulating this written policy.
It is important for landlords to understand that (unlike an inquiry for employment purposes) each inquiry made by a landlord will be reported on the individual consumer’s credit report as an inquiry made. If no additional credit is extended in connection with the inquiry, the consumer’s credit scores could be adjusted downwards thus adversely impacting the tenant.
Want more information on how to comply with the FCRA, or more tips on screening your tenants? Watch our full webinar “Residential Screening – What Every Landlord Should Know.”