SilverLink - Winter 2008 - (Page 14)

risk ManageMent Real Estate Industry Playing Fair in the Housing Market Protect Yourself from Discrimination Suits by John H. Nelson & Chuck Eckert, CIC Little things have the potential to compound and become big problems. That’s not a comforting thought when you’re dealing with Fair Housing and Equal Opportunity complaints against your company or property managers. By applying solid parameters to your tenant screening process, however, you can protect your company, its loss ratio and your insurance premium dollars. The following criteria are considered to be “safe” because they can be independently verified through sources like courthouse records, credit services, etc.: • • • • • Has the applicant lied about rental history, employment or income? Does the applicant have a pet? How long has the applicant held his/her current job? How many places of residence has the applicant had in the last two years? Does the applicant earn at least three times (or in some cases four times) the amount of the rent or rent plus utilities? Has the applicant ever been evicted? Does the applicant have any unpaid judgments? The FHEO Lays Down the Law The mission of the office of Fair Housing and Equal Opportunity (FHEO) is to create equal housing opportunities for all persons living in America by administering laws that prohibit discrimination in housing on the basis of race, color, religion, sex, national origin, age, disability or family status. The goal of fair housing law is to end discrimination and assure equal access to housing for members of “protected classes.” Fair housing law states that a person’s willingness to rent or sell housing to another person cannot be based, even in part, on that person’s race, religion, color, sex, handicap, nationality or family status. • • Clear-Cut Criteria = Compliance Within the past several years, property owners and landlords have experienced a rise in the number of applicants who threaten to file discrimination suits when their applications are denied, no matter what the reason is. The key to remaining compliant when interviewing potential tenants is to have clear-cut criteria for renting or selling to an applicant—and then to rigidly adhere to those parameters during every interaction. The criteria should be objective, easy to quantify and unrelated to the applicant’s membership (or non-membership) in a protected class. Criteria should be based on reliable predictors of a tenant’s ability to fulfill the requirements of the lease, such as paying on time and keeping the unit in good condition. It’s imperative that property owners and management companies look for screening products that categorize criminal records and automatically provide a clear accept/ decline leasing decision based on criteria established for the community. Slightly tougher questions and criteria may result from the opinion of another person or through the use of reports obtained from a prospective tenant’s previous landlord. These criteria are best determined by asking the following simple yes-or-no questions: • • Did the tenant pay $xxx of rent each month (based on what the applicant reported)? Was he/she always on time with rent payments? contact john h. nelson at jhnelson @ ssgi.coM or chuck eckert at ceckert@ ssgi.coM 14

Table of Contents Feed for the Digital Edition of SilverLink - Winter 2008

SilverLink - Winter 2008 Contents Risk Management: Where in the World is Human Resource Consulting? Workers’ Compensation Rate Declines Insurance Certificates Haute Retirement It All Began with a Cup of Coffee Playing Fair in the Housing Market Captives 101 Proceed with Caution Fore! (Or is it Pull? or Giddyup?) Don’t Be Fuelish Employee Benefits: Medical Trend Countdown to Compliance Private Client Services: Buy & Sell Agreements Flood Insurance Pushing Wealth to the Next Generation Client Spotlight: Travel and Transport Internal Happenings: SilverStone Group Giving Back Since 1945

SilverLink - Winter 2008

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