How to Implement HUD Guidelines with Respect to Criminals and the Fair Housing Act

While the Fair Housing Act does not prohibit housing providers from considering criminal history when deciding whether to accept a proposed tenant, arbitrarily refusing housing to anyone with a criminal record is prohibited. A housing provider may face liability for a criminal background screening policy that creates unjustified discriminatory effect. For instance, only running a background check on Black or Hispanic people, or only localities where the neighborhood is predominantly Black of Hispanic.

The Housing of Urban Development (HUD) has circulated a Memorandum that provides “best practices and tips” to avoid liability over criminal background policies. Essentially, it is recommended that landlords should not consider using criminal history to screen tenants for housing, however, if the housing provider chooses to use criminal background screening policies, they should consider the following steps:

1. Have a written criminal screening policy made available to all applicants;

2. Ensure they can justify their policy with reliable evidence showing it assists in protecting residents’ safety and property;

3. Avoid third-party screening companies that use algorithms that may contain racial profiling;

4. Before making an adverse decision, provide the tenant with the criminal record and opportunity to correct information or explain extenuating circumstances;

5. Comply with State and Local Law that limits landlords’ ability to run criminal background checks;*

6. Delay a criminal background check until after other qualifications are verified, i.e., financial; and

7. Conduct an individualized assessment.

(A copy of the HUD Memorandum dated June 10, 2022, is hereto attached.) Assistant Secretary for Fair Housing and Equal Opportunity (hud.gov)

*There is currently a bill in New York City introduced in August 2022, to ban landlords and brokers from seeking a person’s criminal background check. It is called the “Fair Chance For Housing” bill. There are a few exceptions proposed, such as a landlord would not be restricted from checking whether a prospective tenant is a sex offender and legislation would not apply to one or two family homes where the landlord also lives. Last year, landlords successfully stopped the prior attempt to pass similar legislation, however, because the housing crisis has exacerbated, legislation might just pass this time to assist New Yorkers to find housing without their past haunting them because of a prior conviction.

SDK HEIBERGER TEAM