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The Property Management Webinar Series Presents The Tenant Application Process Presented by ABBY LEE, Associate Counsel August 15, 2012.

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Presentation on theme: "The Property Management Webinar Series Presents The Tenant Application Process Presented by ABBY LEE, Associate Counsel August 15, 2012."— Presentation transcript:

1 The Property Management Webinar Series Presents The Tenant Application Process Presented by ABBY LEE, Associate Counsel August 15, 2012

2 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

3 Overview of Lease Application Process 1. The Applicant is provided with a rental application.

4 Overview of Lease Application Process 1. The Applicant is provided with a rental application. 2. 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.

5 Overview of Lease Application Process 1. The Applicant is provided with a rental application. 2. 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.

6 Overview of Lease Application Process 1. The Applicant is provided with a rental application. 2. 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.

7 Overview of Lease Application Process 1. The Applicant is provided with a rental application. 2. 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…

8 The Lease Application What is it?

9 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.

10 The Lease Application TAR form 2003

11 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

12 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.

13 The Lease Application: Authorizations The TAR Lease Application contains two different types of authorizations:

14 The Lease Application: Authorizations The TAR Lease Application contains two different types of authorizations: 1. Page 3 – “Authorization”

15 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.

16 The Lease Application: Authorizations

17 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

18 The Lease Application: The Credit Report What is a credit report?

19 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.

20 The Lease Application: The Credit Report How is credit reporting regulated?

21 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.

22 The Lease Application: The Credit Report What does credit reporting have to do with the lease application process?

23 The Lease Application: The Credit Report It’s everywhere in the lease application process! Where?  Texas Property Code § (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.

24 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.

25 The Lease Application: The Credit Report What does the law require when a landlord requires a credit report in the lease application process?

26 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.

27 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.

28 The Lease Application: The Credit Report What does adverse action mean?

29 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.

30 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.

31 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.

32 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.

33 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

34 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?

35 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.

36 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.

37 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.

38 The Lease Application: Privacy Policy & Business Records How do privacy laws affect Property Managers?

39 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.

40 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 ManualTAR 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.”

41 The Lease Application: Privacy Policy & Business Records How long should you keep applicant information?

42 The Lease Application: Privacy Policy & Business Records Under the law, a business record may be destroyed at any time after the 3 rd anniversary of the date the business record was created. HOWEVER, TREC requires that i f 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.

43 The Lease Application: Privacy Policy & Business Records What is the proper way to discard this information?

44 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.

45 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.

46 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.

47 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

48 The Lease Application: Application Fee & Application Deposit What is an Application Fee?

49 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.

50 The Lease Application: Application Fee & Application Deposit What is an Application Deposit?

51 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.

52 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.

53 The Lease Application: Application Fee & Application Deposit

54 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

55 The Lease Application: Tenant Selection Criteria & Acknowledgement What is Tenant Selection Criteria?

56 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.

57 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.

58 The Lease Application: Tenant Selection Criteria & Acknowledgement TAR has created a Model Tenant Selection Criteria

59 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 to prove it. Does this request need to be done in writing?

60 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.

61 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.

62 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.

63 The Lease Application: Tenant Selection Criteria & Acknowledgement Page 3 of TAR form 2003 Residential Lease Application

64 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.

65 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.

66 The Lease Application: Tenant Selection Criteria & Acknowledgement What happens if the landlord fails to follow these steps?

67 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.

68 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?

69 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.

70 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.

71 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

72 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.

73 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.

74 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.

75 Accepting or Rejecting a Tenant What are the rules?

76 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.

77 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. date the applicant submits a completed rental application to the landlord on an application form furnished by the landlord; or 2. 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.

78 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?

79 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. Review the application for any missing or illegible information and confirm it is complete and signed. 2. Return the application if it is incomplete and request that it be fully completed.

80 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?

81 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.

82 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?

83 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.

84 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?

85 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.

86 Accepting or Rejecting a Tenant Rule 3: A landlord, who in bad faith fails to refund an application fee or deposit, is liable: 1. for an amount equal to the sum of $100; 2. three times the amount wrongfully retained; and 3. the applicant’s reasonable attorney’s fees.

87 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.

88 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)

89 Tying it all together… 1.Before the landlord receives any applications:  Establish Tenant Selection Criteria.  Create a Privacy Policy.

90 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.

91 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 Tenant Selection Criteria available.  Make Privacy Policy available. 3.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.

92 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 Tenant Selection Criteria available.  Make the Privacy Policy available. 3.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. 4. 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  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.

93 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 Tenant Selection Criteria available.  Make the Privacy Policy available. 3.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. 4.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  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.

94 The Tenant Application Process Questions?

95 Conclusion Thanks for your participation in our webinar! Future Webinar Dates: October 17 & December 19 Questions? Contact the Legal Hotline at Give us your feedback! Complete the survey in the follow-up


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