Transcript Property Management Webinar Series The New Repair

The Property Management Webinar Series Presents
The Tenant Application Process
Presented by
ABBY LEE,
Associate Counsel
August 15, 2012
Webinar Outline
•
Finding a Tenant: The Lease Application
•
•
•
•
•
•
•
•
•
Overview
Applicant’s Age
Authorizations
The Credit Report
Privacy Policy & Business Records
Application Fees & Application Deposit
Tenant Selection Criteria and Acknowledgement
Photo ID
Accepting or Rejecting a Tenant
Overview of
Lease Application Process
1.
The Applicant is provided with a rental application.
Overview of
Lease Application Process
1.
2.
The Applicant is provided with a rental application.
The Landlord makes available the printed notice of the tenant
selection criteria and grounds for denial to the Applicant, as well as
the Landlord’s privacy policy.
Overview of
Lease Application Process
1.
2.
3.
The Applicant is provided with a rental application.
The Landlord makes available the printed notice of the tenant
selection criteria and grounds for denial to the Applicant, as well as
the Landlord’s privacy policy.
Applicant must then sign an acknowledgement indicating the notice
was made available.
Overview of
Lease Application Process
1.
2.
The Applicant is provided with a rental application.
The Landlord makes available the printed notice of the tenant
selection criteria and grounds for denial to the Applicant, as well as
the Landlord’s privacy policy.
3.
Applicant must then sign an acknowledgement indicating the notice
was made available.
4.
The Landlord will the process the applications in-house or send
them to a tenant screening agency.
Overview of
Lease Application Process
1.
2.
The Applicant is provided with a rental application.
The Landlord makes available the printed notice of the tenant selection
criteria and grounds for denial to the Applicant, as well as the Landlord’s
privacy policy.
3.
Applicant must then sign an acknowledgement indicating the notice was
made available.
4.
The Landlord will the process the applications in-house or send them to a
tenant screening agency.
5.
Finally, the Applicant is either approved or rejected as a tenant.
If approved, the Landlord and Applicant enter into a lease agreement.
If rejected, the Landlord has certain obligations…
The Lease Application
What is it?
The Lease Application
•
The Texas Property Code defines a “rental
application” as a written request made by an
applicant to a landlord to lease premises from
the landlord.
The Lease Application
TAR form 2003
The Lease Application
•
Residential Lease Application (TAR 2003)
• Key Issues:
1. Applicant’s Age
2. Authorizations
3. The Credit Report
4. Privacy Policy & Business Records
5. Application Fee & Application Deposit
6. Tenant Selection Criteria & Acknowledgement
7. Photo ID
The Lease Application: Age
•
Each occupant and co-applicant 18 years or older must submit
a separate application.
•
Recommended: Property managers should require all adult
occupants to fill out an application even if they are not signing
the lease as a tenant.
•
TAR form 2003 requires this.
•
Why? You should know whether the occupant poses
a risk to you, particularly if the occupant has a prior
criminal record or a bad rental history.
The Lease Application:
Authorizations
•
The TAR Lease Application contains two
different types of authorizations:
The Lease Application:
Authorizations
•
The TAR Lease Application contains two different
types of authorizations:
1. Page 3 – “Authorization”
The Lease Application:
Authorizations
•
The TAR Lease Application contains two different types of authorizations:
1.
Page 3 – “Authorization”
2.
Page 4 - “Authorization to Release Information Related to a
Residential Lease Applicant”
Here, the applicant gives permission:
1.
to current and former employers to release any information about employment
history and income history;
2.
to current and former landlords to release any information about rental history;
3.
to current and former mortgage lenders on property owned to release any
information about mortgage payment history;
4.
to bank, savings and loan, or credit union to provide a verification of funds that
are on deposit; and
5.
to the authorized person to obtain a copy of a consumer report (credit report)
from any consumer reporting agency and to obtain background information.
The Lease Application:
Authorizations
Webinar Outline
•
Finding a Tenant: The Lease Application
•
•
•
•
•
•
•
•
•
Overview
Applicant’s Age
Authorizations
The Credit Report
Privacy Policy & Business Records
Application Fees & Application Deposit
Tenant Selection Criteria and Acknowledgment
Photo ID
Accepting or Rejecting a Tenant
The Lease Application: The
Credit Report
What is a credit report?
The Lease Application: The
Credit Report
A credit report, or consumer report, contains
information about a person’s:
• credit worthiness
• credit standing
• character
• general reputation
• lifestyle
It may also include information about an applicant’s
rental history.
The Lease Application: The
Credit Report
How is credit reporting regulated?
The Lease Application: The
Credit Report
Credit reporting agencies are regulated by the
Federal Trade Commission (FTC) under the
Fair Credit Reporting Act (FCRA).
FCRA was created to protect the privacy of
consumer report information and to guarantee
that the information supplied by credit
reporting agencies is accurate.
The Lease Application: The
Credit Report
What does credit reporting have to do with
the lease application process?
The Lease Application: The
Credit Report
It’s everywhere in the lease application process!
Where?
 Texas Property Code § 92.3515(a) - Grounds for denial of an
applicant may be based on an applicant’s credit history.
 TAR’s Model Tenant Selection Criteria – Landlord will obtain
a credit report to verify an applicant's credit history
 TAR form 2003 Residential Lease Application– Asks about
the applicant’s credit problems & authorizes a landlord to
obtain a copy of the credit report.
The Lease Application: The
Credit Report
What are different ways a landlord can assess an applicant’s
credit?
1. Credit reports from a credit reporting agency, or
credit bureau, like Trans Union, Experian, and
Equifax;
2. Reports from a tenant-screening service that
contain rental history and/or credit history;
3. Reports from a reference-checking service that
contacts previous landlords or parties listed on
the application.
The Lease Application: The
Credit Report
What does the law require when a landlord
requires a credit report in the lease application
process?
The Lease Application: The
Credit Report
1. A landlord must obtain an applicant’s written
permission to run a credit report.
• TAR form 2003 Residential Lease Application
contains an authorization allowing the Landlord (or
agent) to obtain a copy of the applicant's consumer
report.
The Lease Application: The
Credit Report
1. A landlord must obtain an applicant’s written permission to
run a credit report.
• TAR form 2003 Residential Lease Application contains an
authorization allowing the Landlord (or agent) to obtain a
copy of the applicant's consumer report.
2. If the landlord rejects an applicant based solely or partly on
information obtained from the credit report, the landlord
must inform the applicant in writing and provide certain
required information (“Notice of Adverse Action”).
• TAR form 2212 Adverse Action Notice and Credit Score
Disclosure complies with FCRA.
The Lease Application: The
Credit Report
What does adverse action mean?
The Lease Application: The
Credit Report
An ‘adverse action’ is any action by a landlord that is unfavorable to
the interests of an applicant, which includes:
•
denial of an application;
•
requiring a co-signer on the lease;
•
requiring a deposit that would not be required for
another applicant;
•
requiring a larger deposit than might be required for
another applicant; and
•
raising the rent to a higher amount than for another
applicant.
Under the Fair Credit Reporting Act, a landlord must provide a
“Notice of Adverse Action” to an applicant who is rejected based in
whole or in part on information obtained from the applicant’s
credit report.
The Lease Application: The
Credit Report
• If the landlord sends the applications to a tenant
screening agency, their service usually includes a
written notice of denial.
• If the landlord processes the applications in-house, the
landlord should prepare a form letter to be sent to all
applicants denied a lease because of their credit. TAR
form 2212 satisfies this.
The Lease Application: The
Credit Report
If you do not use TAR form 2212, what must the form letter or notice
include?
• the name, address and telephone number of the credit reporting
agency that supplied the report, including a toll-free telephone
number for credit reporting agencies that maintain files
nationwide;
• a statement that the credit reporting agency that supplied the
report did not make the decision to take the adverse action and
cannot give the specific reasons for it; and
• a notice of the applicant’s right to dispute the accuracy or
completeness of any information the credit reporting agency
furnished, and the applicant’s right to a free report from the
credit reporting agency upon request within 60 days.
The Lease Application: The
Credit Report
Liability for failure to comply with Fair Credit Reporting
Act:
• A party may be sued for damages in federal court for
violation of FCRA.
 Maximum fine up to $1,000 per violation
• A prevailing party is entitled to recover court costs and
reasonable attorney’s fees.
• The law also permits a prevailing party to seek punitive
damages for deliberate violations.
Webinar Outline
•
Finding a Tenant: The Lease Application
•
•
•
•
•
•
•
•
•
Overview
Applicant’s Age
Authorizations
The Credit Report
Privacy Policy & Business Records
Application Fees & Application Deposit
Tenant Selection Criteria and Acknowledgement
Photo ID
Accepting or Rejecting a Tenant
The Lease Application: Privacy
Policy & Business Records
What do you do with the information
provided in a lease application or other
documents, like a credit report?
The Lease Application: Privacy
Policy & Business Records
A person may not require an individual to disclose the individual's social
security number to obtain goods or services from or enter into a business
transaction with the person, unless the person:
1) adopts a privacy policy;
2) makes the privacy policy available to the individual; and
3) maintains under the privacy policy the confidentiality and
security of a social security number disclosed to the person.
The policy must include:
•
how the information is collected;
•
how and when it is used;
•
how it is protected;
•
who has access to the information; and
•
the method of disposal.
The Lease Application: Privacy
Policy & Business Records
Bottom line:
If you are using TAR’s Residential Lease
Application, you must have a privacy policy in
place because the application requests the
applicant’s Social Security number.
The Lease Application: Privacy
Policy & Business Records
Any violation of laws regarding privacy policies
subjects the individual of a fine up to $500 a month
during which a violation occurs.
Failure to provide an applicant with the policy, upon
request, is a violation.
The Lease Application: Privacy
Policy & Business Records
How do privacy laws affect Property Managers?
The Lease Application: Privacy
Policy & Business Records
• Property managers are responsible for private information of rental
applicants and should be cautious of information shared with property
owners.
 Only pertinent information should be shared, such as income,
employment history, rental history, criminal history, the number
of occupants, and any pets.
 In general, the credit report should only be given to the landlord
upon permission of the credit reporting agency that prepared it
(look to the agreement with the CRA). If a landlord does receive a
copy, the landlord is also responsible for discarding the report
properly as required by law.
 The application itself could be given to the landlord; however,
because the application contains the applicant’s SSN, the
application should either be redacted or the landlord must have a
privacy policy in place, and store and discard the application
properly.
 Recommended As property manager, it is best to keep all
applicant documents and not provide copies to the landlord.
The Lease Application: Privacy
Policy & Business Records
TAR 2003 (page 3 & 4) – Landlord’s agent or property manager
maintains a privacy policy that is available upon request.
Model Privacy Policy: TAR has a Privacy Policy Manual

Page 3 – “Property owners for whom the company manages do not have access to
personal information in the company’s files. However, the company and its
agents may discuss the information in a tenant’s consumer report or lease
application with a property owner. Copies of such information are provided to
the landlord only: (1) with the tenant’s consent; or (2) if the company ceases to
be the property manager and the landlord requests that the files be sent to the
landlord, the landlord’s attorney, or the new property manager.”
The Lease Application: Privacy
Policy & Business Records
How long should you keep applicant
information?
The Lease Application: Privacy
Policy & Business Records
Under the law, a business record may be destroyed at any time
after the 3rd anniversary of the date the business record was
created.
HOWEVER, TREC requires that if a licensee maintains a trust
account, documentary records of each deposit or withdrawal for that
account must be retained for four years.
TREC requires that this standard be maintained by licensees for
documents relating to all real estate transactions because TREC can
investigate a complaint against a licensee up to four years from the
date of the transaction.
Recommended  Keep confidential information under
lock and key and protect electronic records with
passwords. The Model TAR Privacy Policy contains
this language.
The Lease Application: Privacy
Policy & Business Records
What is the proper way to discard this
information?
The Lease Application: Privacy
Policy & Business Records
State and federal law require that when a business disposes of
business records, the business must take appropriate measures to
dispose of the records if they contain:
• credit reports and credit scores, employment background,
check-writing history, insurance claims, residential or
tenant history and medical history, or
• a person’s name and the person’s date of birth, Social
Security number, mother’s maiden name or other unique
identifying or financial information.
Note: A name and address or telephone number by itself is not
classified as a business record requiring destruction under state
or federal law.
The Lease Application: Privacy
Policy & Business Records
So what are these “appropriate measures” of
disposal?
•
The law states that a business must modify by
shredding, erasing, or other means, the “personal
identifying information” to make it unreadable or
undecipherable.
•
Alternatively, a business may contract with a person
engaged in the business of disposing records to do this.
The Lease Application: Privacy
Policy & Business Records
What happens if you fail to dispose of this
information correctly?
•
Under state law, a business that fails to properly
dispose of a business record is liable for a civil
penalty of up to $500 for each record.
•
Therefore, a business must keep the personal
information safe and secure.
Webinar Outline
•
Finding a Tenant: The Lease Application
•
•
•
•
•
•
•
•
•
Overview
Applicant’s Age
Authorizations
The Credit Report
Privacy Policy & Business Records
Application Fees & Application Deposit
Tenant Selection Criteria and Acknowledgement
Photo ID
Accepting or Rejecting a Tenant
The Lease Application:
Application Fee &
Application Deposit
What is an Application Fee?
The Lease Application:
Application Fee &
Application Deposit
•
Application Fee:
A nonrefundable sum of money that
is given to the landlord to offset the
costs of screening an applicant for
acceptance as a tenant.
The Lease Application:
Application Fee &
Application Deposit
What is an Application Deposit?
The Lease Application:
Application Fee &
Application Deposit
•
Application Deposit:
A sum of money that is given to the
landlord in connection with a rental
application and is refundable to the
applicant if the applicant is rejected as
a tenant.
The Lease Application:
Application Fee &
Application Deposit
Security Deposit vs. Application Deposit
•
A security deposit is a deposit to secure performance of a lease that
has already been entered into.
•
An application deposit is a deposit given by an applicant and
accepted by the landlord before a lease has been entered into.
•
While an application deposit is not considered a security
deposit if there is no binding lease, landlord-tenant agreements
can convert the application deposit into a security deposit
when a lease has been executed.
•
TAR form 2009 ‘Agreement for Application Deposit and Hold
On Property’ is one of them.
The Lease Application:
Application Fee &
Application Deposit
Webinar Outline
•
Finding a Tenant: The Lease Application
•
•
•
•
•
•
•
•
•
Overview
Applicant’s Age
Authorizations
The Credit Report
Privacy Policy & Business Records
Application Fees & Application Deposit
Tenant Selection Criteria and Acknowledgement
Photo ID
Accepting or Rejecting a Tenant
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
What is Tenant Selection Criteria?
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
Tenant selection criteria is the factors a
landlord will examine and base his or her
decision on when selecting a tenant. If the
tenant does not meet this criteria, the
tenant can be rejected.
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
Texas law states:
At the time an applicant is provided with a rental application, the
landlord shall make available to the applicant printed notice
of the landlord’s tenant selection criteria and the grounds for
which the rental application may be denied, including the
applicant’s:
1.
criminal history
2.
previous rental history;
3.
current income;
4.
credit history; or
5.
failure to provide accurate or complete information on
the application form.
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
TAR has created a Model Tenant Selection Criteria
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
Question:
I am representing the applicant and the landlord never
provided the applicant with the tenant selection criteria, even
though we requested it. The applicant was rejected and she
wants her application fee and deposit back, but the landlord
is now claiming we never requested the tenant selection
criteria because we don’t have an email to prove it. Does this
request need to be done in writing?
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
Answer:
No. The request to view the tenant selection criteria does not
have to be in writing. However, the request will, of course, be
easier to prove it is in writing.
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
Steps required to be in compliance with Texas law regarding tenant
selection criteria:
Step One: Landlord or property manager will make available to the
applicant a printed notice containing the landlord’s tenant
selection criteria and the grounds for which a rental
application can be denied when the applicant receives the
tenant application. See TAR Model Tenant Selection Criteria.
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
Step Two:
The applicant must sign an acknowledgement indicating the notice was made
available. If it is not signed, there is a rebuttable presumption that the notice
was not made available.
•
•
•
The acknowledgment must include a statement substantively equivalent to
the following: “Signing this acknowledgement indicates that you have had the
opportunity to review the landlord’s tenant-selection criteria. The tenant
selection criteria may include factors such as criminal history, credit history,
current income, and rental history. If you do not meet the selection criteria, or
if you provide inaccurate or incomplete information, your application may be
rejected and your application fee will not be refunded."
The acknowledgment may be part of the rental application if the notice is
underlined or in bold print.
TAR form 2003 contains the necessary language and a place for signature.
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
Page 3 of TAR form 2003 Residential Lease Application
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
Question:
Could the residential lease application itself serve as notice of
the tenant selection criteria? The application states, under the
‘Authorization’ paragraph, that the landlord or agent can
obtain the applicant’s credit report, employment history, etc.
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
Answer:
No. While the language in the application certainly authorizes
the landlord or agent to obtain information which might be
part of a landlord’s selection criteria, the application alone
does not meet the requirements of the statute. This language
might not contain all the tenant selection criteria the landlord
wants to examine and furthermore, it does not inform the
applicant that they could be rejected if they don’t meet this
criteria.
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
What happens if the landlord fails to follow these steps?
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
If the landlord rejects an applicant and the landlord has not
made the notice of the landlord’s tenant selection criteria
available, landlord shall return the application fee
and any application deposit.
If an applicant requests a landlord to mail a refund of the
applicant’s application fee to the applicant, the landlord shall
mail the refund check to the applicant at the address
furnished by the applicant.
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
Question:
Are there any limits on how many applications can
be accepted at one time? Does the landlord have to
accept only one application at a time?
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
Answer:
No. There are no limits on how many applications a landlord
can accept at one time, thus the landlord does not have to
accept only one application at a time.
However, some landlords may find it easier to only accept one
application at a time in order to make sure all applicable rules
and laws, including fair housing laws, are complied with.
Remember, if applicants are rejected, the application deposit
must be returned.
The Lease Application:
Tenant Selection Criteria &
Acknowledgement
In summary…
1.
Provide applicant with TAR form 2003 Residential Lease
Application.
2.
Provide applicant with notice of the landlord’s Tenant
Selection Criteria.
3.
If the landlord fails to provide the notice of Tenant Selection
Criteria AND the landlord rejects the applicant, the landlord
cannot keep any application fee or deposit.
Webinar Outline
•
Finding a Tenant: The Lease Application
•
•
•
•
•
•
•
•
•
Overview
Applicant’s Age
Authorizations
The Credit Report
Privacy Policy & Business Records
Application Fees & Application Deposit
Tenant Selection Criteria and Acknowledgement
Photo ID
Accepting or Rejecting a Tenant
The Lease Application:
Photo ID
•
If you request a photo ID from an applicant, make
sure the purpose of the request relates to an actual
verification of the applicant’s information.
•
Be uniform and consistent.
The Lease Application:
Photo ID
What if an applicant objects?
•
Under the Texas Transportation Code, an applicant may object to you
making a copy of their photo ID, claiming it is illegal to photocopy a
driver’s license.
•
•
It is only illegal if there is an intent to “sell, distribute, or
deliver a forged counterfeit instrument.”
Under the Fair Housing Act, an applicant may object because they
believe it is a violation of fair housing laws to copy their photo ID.
•
As long as the purpose is to conduct an actual
verification of an applicant’s identity and/or check on
criminal history, rental history, or credit history, the
Fair Housing Act should not be violated.
•
Avoid fair housing violations by using a consistent policy for all
applicants.
Accepting or Rejecting a
Tenant
After the applicant has submitted his or her application, the landlord can
either approve or reject the applicant…
•
If approved, the Landlord and Applicant enter into a lease
agreement. Use TAR form 2001 Residential Lease.
•
If rejected, the Landlord notifies the applicant of is or her denial
and any refund of fees.
•
If the applicant is rejected because they failed to meet one or
more of the tenant selection criteria, use TAR form 2212 Adverse
Action Notice and Credit Score Disclosure.
•
Otherwise, you may notify the applicant in writing or orally that
they have been rejected (or you may do nothing and the applicant
will be deemed rejected after seven days). There is no TAR form
for this.
Accepting or Rejecting a
Tenant
What are the rules?
Accepting or Rejecting a
Tenant
Rule 1:
A landlord can give notice of the applicant’s acceptance or
rejection by phone or regular mail.
•
If by mail, the notice must be postmarked on or before the end of the
seven-day period.
•
If the date of required notice of acceptance or required refund is a
Saturday, Sunday, or state or federal holiday, the required date shall be
extended to the end of the next day following the Saturday, Sunday, or
holiday.
•
If an applicant requests that any acceptance or any refund of the
application deposit be mailed to the applicant, the landlord must mail
the refund to the applicant at the address furnished.
Accepting or Rejecting a
Tenant
Rule 2:
The applicant is deemed rejected by the landlord if the
landlord does not give notice of acceptance of the applicant
on or before the 7th day after the:
1.
2.
date the applicant submits a completed rental
application to the landlord on an application form
furnished by the landlord; or
date the landlord accepts an application deposit if the
landlord does not furnish the applicant an
application form.
Note: Rejection of one co-applicant shall be deemed as
rejection of all co-applicants.
Accepting or Rejecting a
Tenant
Question:
So the 7-day period starts to run after the landlord
accepts a fully completed rental application. What if
the applicant submits an incomplete application,
does that mean the 7-day period never starts?
Accepting or Rejecting a
Tenant
Answer:
Technically, yes. However, you should not rely on this. If you
accept an incomplete application and fail to notify the applicant
that it is incomplete, the applicant may argue that you waived
this requirement.
The best practice is to:
1.
2.
Review the application for any missing or illegible information
and confirm it is complete and signed.
Return the application if it is incomplete and request that it be
fully completed.
Accepting or Rejecting a
Tenant
Question:
I'm a listing agent for a property owner who is
renting his home. I received a rental application and
presented it to the owner. He wants to wait a week or
two before deciding on this applicant to see if a better
match to the tenant-selection criteria comes along.
How long does the owner have to make a decision?
Accepting or Rejecting a
Tenant
Answer:
The property owner has seven days to make a decision on that rental
application, otherwise the applicant is deemed rejected. The seven-day clock
begins on the date the applicant submits a completed rental application on an
application form furnished by the property owner, or the date the property
owner accepts an application deposit if the property owner did not furnish an
application form
Any application deposit should be refunded to the applicant if the
applicant was rejected. Remember, an application deposit is a sum of
money that is given to the property owner in connection with the rental
application that is refundable if the applicant is rejected, whereas an
application fee is a nonrefundable sum of money given to the property owner to
offset the costs of screening an applicant.
Accepting or Rejecting a
Tenant
Question:
What if the applicant wasn't made aware of the
property owner's tenant-selection criteria when he
received the application?
Accepting or Rejecting a
Tenant
Answer:
At the time the applicant was provided with a rental
application, the property owner was required to make available
the printed notice of the owner's tenant-selection criteria. If the
applicant was rejected and the property owner failed to make
the criteria available, the application fee and any application
deposit must be returned. Any wrongful withholding will
subject the property owner to liability. The Texas Association of
REALTORS® has developed a model tenant-selection criteria
form for members' use.
Accepting or Rejecting a
Tenant
Question:
What if the landlord rejects the tenant for a reason other than
that listed as a tenant selection criteria (i.e. the landlord had
two great applicants and just randomly chose one)? Does the
landlord still need to provide TAR form 2212?
Accepting or Rejecting a
Tenant
Answer:
No. TAR form 2212 is only required if the applicant is rejected due
in whole or in part to the applicant’s credit report and can be used
for failing to meet other tenant selection criteria.
If the applicant is rejected simply because several applicant’s
applied and someone had to be rejected, the landlord could notify
the applicant orally or in writing they have been rejected (or do
nothing as applicants are deemed rejected after seven days from
the date a completed application or application deposit is
submitted). Notifying the applicant they have been rejected is the
better practice.
Accepting or Rejecting a
Tenant
Rule 3:
A landlord, who in bad faith fails to refund an
application fee or deposit, is liable:
1.
2.
3.
for an amount equal to the sum of $100;
three times the amount wrongfully retained;
and
the applicant’s reasonable attorney’s fees.
Accepting or Rejecting a
Tenant
TAR form 2009 Agreement for Application Deposit and Hold on
Property provides the landlord's obligations upon approval or
non-approval.
List of TAR Forms
The following TAR Forms are available for member use only:
•
•
•
•
•
•
•
•
Residential Lease Application (TAR 2003)
Authorization To Release Information Related To A
Residential Lease Applicant (TAR 2003, last page)
Residential Lease Guaranty (TAR 2007)
Application For Guarantor of Residential Lease (TAR 2007)
Agreement For Application Deposit And Hold On Property
(TAR 2009)
Adverse Action Notice and Credit Score Disclosure (TAR
2212)
Request For Rental History (TAR 2214)
Request For Employment Verification (TAR 2219)
Tying it all together…
1.
Before the landlord receives any applications:
 Establish Tenant Selection Criteria.
 Create a Privacy Policy.
Tying it all together…
1.
Before the landlord receives applications:

Establish Tenant Selection Criteria.

Create Privacy Policy.
2. When the landlord receives interest from a prospective tenant:
 Give the prospective tenant TAR form 2003 Residential
Lease Application.
 Make the Tenant Selection Criteria available.
 Make the Privacy Policy available.
Tying it all together…
1.
2.
3.
Before the landlord receives applications:

Establish Tenant Selection Criteria.

Create Privacy Policy,
When the landlord receives interest from a prospective tenant:

Give the prospective tenant TAR form 2003 Residential Lease Application.

Make Tenant Selection Criteria available.

Make Privacy Policy available.
Screen or review applications within seven days of receiving completed
application from the tenant or from receiving the application deposit.
 Discuss findings generally with the landlord.
 Do not give the credit report to the landlord without first
verifying you have permission from the credit reporting
agency to do so. Remember, the landlord must properly
discard the report.
 Do not give the application to the landlord without removing
the social security number or insuring the landlord has a
privacy policy in place. Remember, the landlord must
properly discard it also.
Tying it all together…
1.
2.
3.
4.
Before the landlord receives applications:

Establish Tenant Selection Criteria.

Create Privacy Policy.
When the landlord receives interest from a prospective tenant:

Give the prospective tenant TAR form 2003 Residential Lease Application.

Make Tenant Selection Criteria available.

Make the Privacy Policy available.
Screen or review applications within seven days of receiving completed application from the tenant or from receiving application
deposit.

Discuss findings generally with the landlord.

Do not give the credit report to the landlord without first verifying you have permission from the credit
reporting agency to do so. Remember, the landlord must properly discard the report.

Do not give the application to the landlord without removing the social security number or insuring the
landlord has a privacy policy in place. Remember, the landlord must properly discard it also.
Accept or reject the tenant:

If you accept the tenant, sign TAR 2001 Residential Lease within two days.

If you reject the tenant because they failed to meet one or more of the tenant
selection criteria, notify the tenant with TAR form 2212 .

If you failed to make available to the applicant the tenant selection
criteria, you must refund both the application fee and any application
deposit.

If you made available the tenant selection criteria, you may keep the
application fee, but must refund the application deposit.

If you reject the tenant for any other lawful purpose, you may notify the
applicant in writing or orally (or you may do nothing and the applicant will be
deemed rejected after seven days). You must refund any application deposit.
Tying it all together…
1.
2.
3.
4.
Before the landlord receives applications:

Establish Tenant Selection Criteria.

Create Privacy Policy
When the landlord receives interest from a prospective tenant:

Give the prospective Tenant TAR form 2003 Residential Lease Application

Make Tenant Selection Criteria available.

Make the Privacy Policy available.
Screen or review applications within seven days of receiving completed application from the tenant or from receiving application
deposit.

Discuss findings generally with the landlord.

Do not give the credit report to the landlord without first obtaining permission from the tenant and the
credit reporting agency.

Do not give the application to the landlord without removing the social security number or insuring the
landlord has a privacy policy in place.
Accept or reject the tenant:

If you accept the tenant, sign TAR 2001 Residential Lease within two days.

If you reject the tenant because they failed to meet one or more of the tenant selection criteria, notify the tenant
with TAR form 2212 .

If you failed to make available to the applicant the tenant selection criteria, you must refund both the
application fee and any application deposit.

If you made available the tenant selection criteria, you may keep the application fee, but must refund
the application deposit.

If you reject the tenant for any other lawful purpose, you may notify the applicant in writing or orally (or you
may do nothing and the applicant will be deemed rejected after seven days). You must refund any application
deposit.
 Keep all documents, including notes, related to an applicant
and/or tenant for four years, then discard properly the
documents that contain confidential information.
The Tenant Application Process
Questions?
Conclusion
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