How can I decline an application?

When you receive an application to your listing, you are given access to the applicant’s consumer reports. Consumer reports contain information about the applicant’s rental history, credit history and criminal history.

If, after reviewing an applicant’s consumer reports, you are leaning towards declining the application , here are some things to consider.

What do I need to know about declining an Application?

When you use consumer reports to make a decision on a rental application, the Fair Credit Reporting Act (FCRA) requires you to take important compliance steps. The FCRA is enforced by the Federal Trade Commission (FTC).

If you reject an application due to information contained in an applicant's consumer reports, this is considered an adverse action by the FTC.

An adverse action is any action by a landlord that is unfavorable to the interests of a rental applicant.

Common adverse actions include:

  • Asking for a co-signer
  • Requesting an additional or larger deposit
  • Denying an applicant
  • Increasing the monthly rental rate due to the consumer report
Note: You can find more information on adverse actions at the  FTC website .

Do I need to provide an Adverse Action Notice?

When you decline an application to your listing, both you and the applicant will automatically receive email notifications about your decision.

If the decision to deny the application is based on information in the consumer reports that the applicant shared with you, you must send an Adverse Action to comply with your obligations under the FCRA.

Per the Federal Trade Commission, an adverse action, "tells people about their rights to see information being reported about them and to correct inaccurate information."

Whether notified by phone or sent in an email, providing an applicant with this notice will go a long way in making the rental process smooth for all parties.

Tip: does not make decisions on the merits of an application nor does it provide a status update to an applicant on your behalf.

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