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Contents
Landlord Studio is an easy to use property management and accounting software designed for landlords.
Find and screen tenants, collect rent online, track income and expenses, run reports, and more - all for free.
This article provides general information and is not legal advice. For accuracy and specific guidance on landlord-tenant laws, consult an attorney before making any decisions or taking action.
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Most landlords agree that having an unreliable tenant can lead to many problems, from late payments to property damage. That's why you have to be meticulous and thorough when screening potential renters.
Yet, landlords must understand California tenant screening laws to ensure compliance and avoid discriminatory practices. Some state laws govern how tenant background checks in California are used and handled during the tenant screening process. Knowing all these laws and legal requirements will help you avoid litigation problems.
Our review of tenant screening laws in California 2024 covers everything you need to know about tenant screening in California.
Below are some key California tenant screening laws landlords need to know and follow when evaluating potential renters.
According to the California Fair Housing Act, landlords are prohibited from discriminating against applicants based on race, color, national origin, religion, sex, familial status, disability, and source of income.
The Fair Employment and Housing Act (FEHA) further extends the state’s protections against discrimination and harassment in housing for tenants and applicants.
Additionally, the Unruh Act safeguards against discrimination by all businesses, including housing providers, based on various characteristics such as age and sexual orientation.
Finally, the Fair Credit Reporting Act (FCRA) regulates how consumer reporting agencies handle tenant information, requiring consent before background checks are conducted.
All these tenant screening laws in California ensure that the rights and interests of both property owners and tenants are protected.
Should information gained through a credit report or background check be used in the final decision when rejecting a tenant application landlords the FCRA stipulates that the landlord must fairly inform the tenant with an adverse action notice. This should inform the applicant of the reason for their decision and provide them a copy of their tenant screening report should they request one. This is so tenants dispute the decisions should they need to.
Under California tenant screening laws, landlords can request an application fee from a tenant-applicant. This fee is treated differently from costs such as security deposits.
Additionally, the fee is expected to cover the actual cost of the screening services used and time spent during the application process. Landlords are prohibited from unfairly profiting from these fees.
According to the California Apartment Association, the maximum amount a landlord can charge as screening fees is regulated by the state and updated yearly to reflect the annual increase in the Consumer Price Index.
Following the update to tenant screening laws in California 2024, effective as of December 2023, the tenant screening and application fee is pegged at $62.02 per applicant. While this figure represents the maximum amount for tenant screening fees, California tenant screening laws further prohibit landlords from requesting beyond the incurred costs during the screening process.
According to California Civil Code Section 1950.6, landlords must do the following after collecting screening fees from an applicant. These include:
Another important update landlords should take note of is the legality of reusable credit reports for tenant screening in California, which has been made effective as of January 2023.
The California rental market is tight, with renter applicants having to submit multiple applications before securing a rental space, with the significant cost of screening fees. This law allows tenant applicants to purchase reusable credit reports and submit them to multiple landlords within 30 days.
It's important to note that landlords are not required to accept a reusable credit report as a background check for rental applications in California. However, landlords that do accept one would not be able to charge an application screening fee for accessing the report from a third-party provider (Cal. Civ. Code § 1950.1 (2023)).
Per tenant screening laws in California, landlords must provide written screening criteria to tenant applicants during the application process. Examples of popular screening criteria in California include no smoking, no pets, must make 3x the monthly rent, no violent crimes, and no previous evictions.
An ideal screening criteria would help property owners effectively filter qualified applicants from the rest. However, it's important to note that these screening criteria are expected to be non-discriminatory towards protected classes as outlined in the federal FHA and California law.
According to the California Apartment Association, landlords should ensure they use the same screening criteria for all applicants to avoid claims of discrimination. Additionally, it's good practice to choose the first applicant to meet the criteria.
Finally, it's recommended that landlords review their screening policies with the help of a lawyer before implementation.
At the federal level, matters concerning tenant background checks in California are regulated by the Fair Credit Reporting Act. This act outlines specific obligations for landlords when handling consumer reports, including background checks.
Additionally, the FCRA requires landlords to secure written permission from current or potential tenants before requesting a consumer report, including background checks, from a consumer reporting agency. They are also mandated to offer certain disclosures and adhere to particular protocols during the tenant screening process.
Several state laws govern background checks in California for rental. According to California Civil Code §1950.6, landlords cannot charge a screening fee if no rental unit is available unless it will be vacant within a reasonable time frame. This provision aims to protect tenants from unwarranted fees during the application process.
Additionally, the Fair Employment and Housing Act and the Unruh Act prohibit discrimination based on protected characteristics such as race, color, national origin, religion, marital status, disability, gender identity, and more.
While having a criminal history is not a protected characteristic, landlords need to note that misuse of this information can lead to discriminatory practices.
Below is a summary of the steps involved in a typical California tenant screening.
It's good practice to begin the screening process by asking pre-qualification questions to assess if applicants meet basic criteria like income, rental history, and timeline for moving in.
Next, collect essential information, including contact details, addresses, employment history, proof of income, and consent for background checks.
Then, proceed to perform comprehensive checks on credit history, criminal records, and rental history. Ideally, you should use an online screening service to quickly and legally access these reports.
When selecting an online tenant screening service, we recommend you prioritize the accuracy and detail of the information provided about potential tenants. Additionally, it's crucial you consider factors like cost, data security, and report delivery.
For an effective option, Landlord Studio stands out, offering a comprehensive tenant screening California report that includes credit scores, rental history, background checks, and eviction records. You are assured reports will be generated in as little as 30 minutes. Reports are free for landlords and cost the tenant as little as $45.
Create your free Landlord Studio account to run your free tenant screening report today.
After accessing the reports, evaluate the applications based on consistent criteria to ensure compliance with tenant screening laws in California.
It's important for landlords to notify applicants of decisions promptly and provide clear reasons for any denials to maintain transparency.
We can't stress enough how important it is to follow these California tenant screening laws.
To begin with, you should know that these laws exist to enhance transparency in the rental process, building trust between landlords and tenants. Penalties for unlawful background checks in California for rental range from a couple of fines to actual jail time.
Using a good tenant screening service like Landlord Studio can save you a lot of time and stress trying to keep up with constantly changing laws. Landlord Studio offers affordable tenant screening services that prioritize legal compliance, detailed reporting, and speed of delivery.
Create a free Landlord Studio account today to simplify your California tenant screening.
