Landlord’s Costly Tenant Screening Mistake

by | Mar 27, 2017 | Tenant Screening

A landlord in Ontario is facing a discrimination complaint after rejecting rental applicants allegedly on the basis of their youth.

The millennial couple say they possessed the qualifications — including excellent credit and ample income — to rent a two-bedroom condo. According to a news report, the applicants claim that the landlord indicated via email that young renters are unappealing due to “potential problems” that might arise. The landlord also allegedly claimed that the couple’s income was too low even though their combined rent-to-income ratio was under 35%.

Rejecting tenants on the basis of age is prohibited by the Ontario Human Rights Code. As a result of the mistake, the landlord now faces potential legal expenses to defend a claim in the Human Rights Tribunal, and the payment of damages should the landlord lose.

There is another crucial problem with stereotyping — applying perceived characteristics to an entire class of rental applicants. A perception of what sort of person would suit the property can blind the landlord to the truth about a person’s true nature. That works both ways. While quality prospects are unfairly rejected, the landlord also suffers from false confidence when it comes to the “ideal” renter.

By focusing on irrelevant factors, the landlord not only overlooks actual qualifications, but falls victim to those who only seem qualified. Professional tenants — the ones who pretend to be ideal renters — are counting on landlords to make that mistake.

It’s important to meet potential tenants face-to-face to confirm identity. However, the tenant screening process should be objective, so that each applicant, even an “ideal” one, is subject to the same scrutiny.

This case highlights another potential tenant screening mistake. The applicants had indicated that they wanted to bring in two roommates who were family members to share the rent. This is a common request in areas where vacancies are extremely low and rents are climbing.

It’s not clear if the landlord required a separate rental application and tenant background check on each of those intended roommates. That is an important step in the tenant screening process. Allowing the rental applicants to oversee roommates who are not on the tenancy agreement can be a costly mistake. For instance:

If the original tenants move out, the landlord has no information regarding the remaining occupants;
The tenancy agreement does not cover occupants not on the lease; and
There is no way to know if the occupants are unqualified or inappropriate.

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 in 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.

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