What are the legal criteria for denying a potential lessee and is it legal to require someone to cosign the lease?

Background: I am planning to purchase properties to rent to college students.

Questions: What are legal criteria for denying a potential lessee? Can a person be disqualified based on GPA or the "disability" of alcohol addiction/abuse? Also, can a lessee be required to have someone cosign the lease and provide surety against property damage?

 

You have the right to deny tenancy as you please. Just like a restaurant has the right to deny service to anyone. You can deny them for having bad breath. Private Property. Perks of OWNING SHIT! If you are in a student housing designated area/district, you need to ask the university Below are some more common reasons given... "Your request for tenancy has been denied for the following reason(s) below: ____ Application incomplete ____ Suit, repossession, foreclosure ____ Excessive financial obligations ____ No credit on file ____ Insufficient credit references ____ Insufficient credit on file ____ Insufficient length of employment ____ Insufficient income ____ Too short a period of residence ____ Previous eviction(s) ____ Unable to verify residence ____ Bankruptcy ____ Unable to verify credit references ____ Irregular employment ____ Unable to verify employment ____ Delinquent credit references ____ Unable to verify income ____ Felony ____ Other ______________________ "

Make opportunities. Not excuses.
 

With a little Google search, I came across a Nolo blog post on this very subject.

Basically: "The Federal Fair Housing Acts (42 U.S. Code §§ 3601-3619) prohibit discrimination on the basis of race, color, religion, national origin, gender, age, familial status (having children), and physical or mental disability (including alcoholism and past drug addiction). In addition, many states and cities also prohibit discrimination based on marital status, gender identity, and sexual orientation."

 

So what WatTProf said, you can not rent for any other reason than discrimination - there is nothing about tattoos, employment history, ability to pay, disrespect, criminal activity, fraternity affiliation, reputation, etc.

"Everyone has a plan until they get punched in the face."
 
Best Response

If you're planning to buy multiple properties, why not talk to a lawyer, or at least a real estate broker who rents properties in your market? They'll have a much better handle on what you can and cannot do than a few strangers with opinions on the internet. Worth doing that due diligence if you're making a substantial investment.

 

First of all your state laws are likely to be more strict that the federal FHA. So don't take these jabroni's word that you can deny someone for something like past criminal activity because there are indeed states where that is illegal (for example prior drug use).

One interesting thing to note is that there are exemptions to the FEDERAL FHA as follows: (a) owner-occupied buildings with no more than four units (which is commonly known as the Mrs. Murphy exemption); (b) single family housing sold or rented without the use of a broker if the private individual owner does not own more than three such single family homes at one time; or (c) housing operated by organizations and private clubs that limit occupancy to members.

Again, your state will most likely have statutes in place that are more encompassing than the federal act.

 
SHB:

First of all your state laws are likely to be more strict that the federal FHA. So don't take these jabroni's word that you can deny someone for something like past criminal activity because there are indeed states where that is illegal (for example prior drug use). Again, your state will most likely have statutes in place that are more encompassing than the federal act.

this. You're basically asking legal advice, OP.

Having said that, if it's a small project (which it must be, given this thread), the better question is who gives a shit? Even if it's illegal, what is the likelihood you are actually going to get in trouble? Probably zero.

 

most properties in my area require students to have cosigners unless their credit is great. some private homes don't allow for "roommate situations," which is a unique way of saying "no students," but it's not quite age discrimination.

as for property damage, that's what a security deposit is for. good luck finding tenants if you ask for more than what's normal in your market.

also, I knew plenty of kids with great GPAs who treated their apartments/houses like absolute shit, I think discriminating against kids based on that is both silly and wrong. discriminate on credit & criminal history.

put terms in the lease about parties, excessive noise, and parking (if they party, people will park on your lawn). other than that, they're college kids, you should expect some damage.

 

Like others have said, real estate laws vary pretty widely by state. Ask a lawyer or local broker. I would imagine student housing on a small scale would be a pain in the ass though. Basically annual turnover, property damage, complaints by neighbors, etc.

I remember one rental law in Boston deemed four or more unrelated women living together as a brothel. So you could call most college girls there whores in a legal sense.

 

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