California is among at least 15 other states and over 100 cities that have passed prohibitions against source of income discrimination. This month, California broadens its rules to include rental applicants using Section 8 vouchers.
Several California cities already have passed this provision, but the new law makes it illegal throughout the state to discriminate against voucher holders.
Specifically, landlords no longer can include a restriction on any source of assistance, federal, state, or local, in rental ads, reject tenants who present vouchers due to source of income, charge higher deposits or other burdens, or evict a tenant for pursuing their legal rights.
Under California’s new rules, tenants still can be rejected if they lack other qualifications such as sufficient income or good rental history. However, any income to rent ratio requirements must be applied to the tenant’s portion of the rent. For instance, on a $1,000 per month rental, if the voucher is for $700, an income ratio of three times rent is $900 per month, not $3,000.
When renting to households, landlords must consider all incomes combined, unless the landlord requires all other married tenants to each qualify individually. Landlords can ask about the source of income as long as the landlord does not discriminate.
Landlords may need to modify rental applications to provide for the contingency of income from government assistance. Application questions that appear to favor employment income or discourage applicants who receive assistance may be viewed as discriminatory.
The move is not without controversy, as many landlords are fearful of the ramifications of accepting government vouchers. Landlords may be required to facilitate a property inspection, which can result in action items, and alter lease agreements to meet rules for federal assistance.
Other lawmakers have stopped short of requiring acceptance of the Housing Choice Voucher Program, or Section 8, because that federal law was intended to be voluntary. There is concern that forcing some landlords to comply with the regulations surrounding these vouchers will scare off other landlords and investors who otherwise might have volunteered.
However, it may only be a matter of time before source of income is viewed as a protected class across the country. Because so many voucher holders are minorities or suffer disabilities, a stated ban on accepting government assistance or a practice of doing so already may violate the Fair Housing Act.
In a related story, HUD is soliciting suggestions from community members on how to make affordable housing less burdensome for housing providers. For more, visit HUD.
This post is provided by Tenant Verification Service, Inc., helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening, Tenant Background Checks, (U.S. and Canada), as well as Criminal Background Checks, and Eviction Reports (U.S. only).
Click Here to Receive Landlord Credit Reports.
Disclaimer: The information provided in this post is not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.
