Housing can be denied for a variety of legitimate reasons, but you have to be careful. A landlord cannot reject an application arbitrarily. If you aren’t sure, review the Missouri housing law. Here are a few common examples of reasons you can and cannot deny a housing application.
It is legal to ask a tenant if they smoke during your initial conversation, during the property showing, or on your rental application. Some landlords don’t allow tenants who smoke in the unit, the building, or anywhere on the property.
Smoking can be a health hazard to other tenants. It’s a fire hazard and causes an odor problem. Therefore, the risk of property damage is important to consider. If you don’t want a tenant who smokes in your property, you are legally allowed to deny him or her for this reason.
The Tenant Doesn’t Make Enough Money
Your rental property is a business enterprise. Therefore, your tenant needs to be able to pay rent every month. If they do not meet your income requirements, it is ok to deny the application. The typical rule of thumb is that the tenant’s income should be three times the price of rent.
Income Can’t Be Verified
What if they won’t share that information? If your tenant won’t disclose his or her income and won’t provide employer references, then you have the right to deny that tenant. At Deca Realty Company, we make it easy for tenants to verify income. We offer prospective tenants a uniform, online application process that allows tenants to upload all necessary documents.
A pet is not the same thing as a service animal or emotional support animal.
It’s common for property owners to have rules about pets. For instance, some only allow pets that are a certain size or breed. You can also choose to say “No pets.” Some property owners are more pet friendly, or allow pets and make extra money by charging pet rent and a pet deposit. Whatever rule you choose, you are allowed to deny a tenant if they don’t match your pet requirements.
For every property managed by Deca Realty Company, the pet policy is stated upfront in the listing.
No Rental History
A prospective tenant may be denied for not having a prior rental history. If there’s no history, it’s possible they were living in a dormitory, at a parent’s house, or owned a home.
A tenant cannot be denied housing based on an arrest record, because innocent people can be arrested. However, a tenant with a criminal conviction can be denied. As a property management company, we cannot refuse to rent to a tenant just because they have a criminal record. We have standardized policies in place to refuse tenants with certain convictions that would put your property or other tenants at risk.
Low Credit Score
If a tenant’s credit report shows a low credit score, then you have grounds to reject that tenant. The credit score usually indicates a tenant’s financial responsibility. A low credit score can indicate that a tenant isn’t making payments on time, has significant debt, or a history of foreclosure or bankruptcy.
The Tenant Provides False or Incomplete Information
If a prospective tenant lies during the tenant screening process, it’s a huge red flag. They might be trying to cover up something and their application can be denied.
When we find false information, it is commonly about income or references.
A tenant may leave a part of the rental application blank by mistake. But if the tenant purposely omits necessary information, their application may be denied.
On the rental application, ask tenants if they were ever evicted in the past. Sometimes this information will surface through the background check, but not always.
Sometimes tenants can explain their prior financial troubles, and if they have other indicators that positively show they’ll be able to pay rent, then you can make your best judgment call. Filing for bankruptcy typically indicates that the tenant is not financially responsible. We recommend asking your tenant to explain the situation that led to bankruptcy.
History of Property Damage or Skipping Rent
When you reach out to a tenant’s prior landlords, ask them if the tenant was a responsible renter. If the landlord reports the tenant left the property in bad condition or missed rent, you can legally deny the tenant. Approving someone with a questionable history may cost you more money in the long run.
These are just some of the many legal reasons that a landlord may deny a person’s housing application, even if the applicant is a member of a protected class.
There are also legal reasons a tenant cannot be rejected for housing. Take a look at this list.
Tenants cannot be rejected for the following:
- Sexual orientation
- Familial status
- Participation in the Section 8 Program or other subsidy programs
- Arbitrary discrimination
- National origin
- Gender / Gender identity
- Marital status
Arbitrary discrimination is any choice that discriminates against a group of tenants, like choosing not to rent to tall men or tenants who are sports fans. Any arbitrary rule that denies tenants access to your rental property is considered arbitrary discrimination and should be avoided.
Knowing all this, you can see how using a property management company can offer additional protection for property owners. At Deca Realty Company, we use a standard application process created with consistent criteria. Contact us if you have questions about our property management services. We’re happy to walk you through the process or answer any questions you might have.