Important Note: This post is not legal advice. Entrata strongly recommends that our clients consult their own counsel for advice on your legal obligations and compliance with applicable laws and regulations. 

Fair Chance Housing, often known as Ban-the-Box laws in the employment context, has been making waves in the housing sector. This evolving legislative trend aims to limit the influence of criminal records on the decision-making processes of landlords and housing providers nationwide. As these laws gain traction, they are reshaping how housing opportunities are distributed and challenging traditional practices in tenant screening.

In recent years, numerous states and local jurisdictions have amended Fair Chance Housing regulations specifically around the disclosure of consumer reports to applicants who face rejection based on such reports. Under the Fair Credit Reporting Act (FCRA), consumer reporting agencies are required to disclose all information in a consumer's file, including the sources of that information, but only "upon request" by the applicant. However, recent legislative changes have expanded this requirement, mandating that a consumer report be provided to applicants immediately upon denial, rather than merely upon request. This shift aims to enhance transparency and fairness in the application process.Further, Fair Chance Housing laws introduce several key requirements for housing providers and landlords focused on transparency and fairness in the rental process. One significant provision is that if a consumer report is used as the basis for denying an applicant, the housing provider must furnish that report to the applicant. This requirement ensures that applicants have access to the information used in the decision-making process and can understand the reasons behind their denial.

These laws place a strong emphasis on the use of criminal records. In many cases, they stipulate that landlords must provide a conditional offer of housing before conducting a criminal background check. This means that applicants are given an initial chance for approval based on their qualifications, among other factors, rather than being immediately disqualified for a criminal record. By shifting the focus to a more balanced evaluation, these regulations aim to reduce the impact of past criminal history on an individual's ability to secure housing, promoting a fairer and more equitable rental process.Below we highlight a few of the state and local jurisdictions that require disclosure of a consumer report to an individual. 

• In 2021, Massachusetts amended 803 Mass. Reg. 5.14 to mandate that housing providers furnish a copy of the consumer report to applicants if they intend to take adverse action based on criminal history.
  • Additional requirements to consider: 
    • Notify the housing applicant in person by telephone, fax, or providing an electronic or hard copy correspondence of the potential adverse housing action;
    • Provide the applicant with a copy of his or her Criminal Offenses Record Information (CORI) or other criminal history and disclose the source of the criminal history information;
    • Identify the information that is the basis for the potential adverse action;
    • Provide the applicant with the opportunity to dispute the accuracy of the information;
    • When CORI is considered as a part of a potential adverse action, provide the applicant with a copy of DCJIS information regarding the process for correcting CORI.
• Colorado's Revised Rental Application Fairness Act (38-12) requires landlords to provide a denial letter, including a copy of the report upon which the decision was based. Additionally, landlords must make a “good faith effort” to deliver this information no later than twenty calendar days after the denial decision.
  • Additional requirements to consider: 
    • If a landlord uses criminal history as a criterion in consideration of an application, the landlord shall not consider an arrest record of a prospective tenant from any time or any conviction of a prospective tenant that occurred more than five years before the date of the application (with exceptions);
    • Restrictions on use of financial information, including amount of income (except for the purposes of verifying ability to pay rent.), credit score, adverse credit event, or lack of credit score (unless required by federal law).
• Montgomery County, Maryland, has enacted regulations that necessitate sending a consumer report to the applicant when a conditional offer is rescinded. According to Section 27-15A of the Montgomery County Code, housing providers must provide the consumer report that outlines the basis for the decision to rescind the offer.
  • Additional Requirements to consider:
    • Notify the applicant of the intention to rescind the conditional offer and the items that are the basis for the intention to rescind the conditional offer; 
    • Delay rescinding the conditional offer for 7 days to permit the applicant to give the housing provider notice of inaccuracy of an item or items on which the intention to rescind the conditional offer is based.
• In Cook County, IL (Ord No. 19-2394) landlords are required to conduct criminal background checks only after extending a conditional offer. Landlords must provide a copy of the criminal background check to the applicant within five business days of receipt. The applicant also has the right to dispute the accuracy or relevance of the information within five days of receiving the report.
  • Additional Requirements to consider: 
    • Landlords must provide a copy of the background check within five business days of receiving a criminal background check.
    • Once the applicant receives the results of the background check, the applicant has five business days to provide evidence that disputes the accuracy or relevance of information related to the criminal background check. 
    • The landlord then has three business days from receipt of the dispute information to accept or deny the application.
• Philadelphia, PA (The Philadelphia Code Section 9-1108) mandates that rental property owners provide a copy of the consumer report upon denial and include the reasons for denial in plain language. This does not require a consumer report to be provided before denial but no later than within three business days of the rejection. 
• Connecticut (CT SB No. 998) requires landlords to provide a copy of the tenant screening report if a fee is charged.
• California’s Cal. Civ. Code § 1950.6 (f) requires a landlord (or its third party screening provider) to provide a copy of the consumer report “to the applicant who is the subject of that report” IF an application screening fee has been paid by the applicant. However, this is still dependent on a request being made by the applicant, not automatically being sent.
  • Additional Requirements to consider: 
    • No application fee may be charged if the landlord knew, or should have known, no units were available at the time of the screening.
    • The screening fee may not be greater than “the actual out-of-pocket costs of gathering information concerning the applicant.”

ResidentVerify has created an automated solution based on region to solve for these evolving changes. These options are triggered based on property location as well as applicant location to assure the most relevant consumer report delivery option is provided. This requires no setting changes by the customer. For additional details of this process please visit the compliance page located in the Entrata Help Center. We still encourage customers to review their region and contact their Entrata representative to ensure the appropriate reports are being sent automatically. Entrata recognizes the importance of staying current with regulatory trends and new legislation that may affect our clients. We are committed to providing relevant and accessible resources to keep you informed about legislative updates. To stay updated, please follow this page and sign up for notifications in the Entrata Help Center compliance page for additional compliance articles. For any questions or further information, feel free to reach out to your Entrata representative.