What Are Valid Reasons to Reject an Applicant in California?

California has its own fair housing regulations that are more thorough and stringent than the federal law. This means that there are more things for California landlords to avoid when generating their screening practices and policies. Here are the valid reasons to reject an applicant in California.

1. Ability to pay the rent

If you set clear and objective financial requirements for a tenant and the applicant doesn't meet these requirements then you're in the clear. This applies to income, employment savings and credit score. Keep in. mind, however, that if you use any financial data that you get from a credit report you're required to send an adverse action notice to the applicant, telling them in writing why you rejected their application.

2. A low credit score or a frozen credit score

FICO score can be one of these requirements, but the Fair Credit Reporting Act requires you to tell the applicant in writing that you rejected their application because of their credit score. In California, consumers can legally place a “security freeze” on their credit reports, which prevents the consumer credit reporting agency from releasing their information to outside parties without consent. If the applicant has done this and didn't suspend the freeze so you could see their credit history then you can reject them on this basis in California.

3. Personal preferences that don't violate the fair housing act

The Fair Housing Act shields people from housing discrimination based on race or color, religion, national origin, familial status, disability, and gender. California has some of the strongest state fair housing laws in the country, which stop landlords from rejecting applicants because of their sexual orientation, source of income, citizenship status, and more.

As long as your policies aren't in clear violation of fair housing in California then you're free to reject an applicant for whatever you want, such as a pet or because they're smokers.

4. Conviction of a crime that would threaten your property

Although people with criminal or housing court records are not technically a protected class under the Fair Housing Act, this is a legal grey area so you should tread carefully. To protect yourself, set a clear and objective policy related to criminal history and apply it equally to every tenant. A blanket policy against all convictions of any kind is likely to be perceived as discriminatory. You're never allowed to reject an applicant based on arrest record - they have to have been convicted.

5. Too many occupants as long as none are children

If a group of college kids applies to live together in your one bedroom apartment unit then you can reject them on this basis. The only situation where number of prospective occupants is not a valid reason to reject a tenant is if those occupants are children of the applicant.

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