Landlord/Tenant Q&A: CATHERINE M. MATTHEWS (R), GRI
CATHERINE M. MATTHEWS (R), GRI
Broker-In Charge, Callahan Realty, Ltd.
Past President, Oahu Chapter
National Association of Residential Property Managers
Q. I have a small one bedroom apartment that is close to downtown and very often get foreign students interested in renting the unit. Many times they will tell me that they are here for just a year or two and their parents are paying for their rent and usually they aren’t working. I want to rent to them but don’t know how to qualify them. They don’t even have social security numbers. What do I do?
A. As a landlord, the Fair Housing Act makes it illegal for you to deny housing to a renter based on nationality. However, you can ask for documentation showing how long they will be in the United States – this might be important information, especially if you are offering a fixed lease that goes for a year or more. To avoid legal problems, you can’t refuse to rent to a qualified foreign citizen just because that person is not a U.S. citizen.
So how do you qualify them? What you should do is give the foreign renters the same application that you provide to all other applicants. You should also charge the same application fee that you do for all other applicants and require documentation verifying the information they provide. You will want to check their identification but don’t ask for anything more than you would for any other applicants – for example, don’t ask for multiple forms of identification if you don’t do this for all applicants.
Ask for a list of rental or credit references since the foreign renters probably won’t have a credit history in the United States – if they do, then go ahead and run the credit report as you normally would. You can ask to see verification of funds in savings or checking accounts but keep in mind that funds that are there today may not be there tomorrow. If their parents are the ones paying the rent, then you are within your rights to get an application and verifying documents from them as well.
Make the international calls to check the rental references of the foreign renters. You can ask about any payment history problems, complaints against the renters as tenants or any move-out problems. If your foreign renters have lived in the U.S. for a while, you may be able to call rental references within the U.S. as well. Additionally, you can legally run a criminal background check on the applicants, which will disclose any foreign criminal activity – of course you would only do this if this is standard operating procedure for all other applicants. Remember, an applicant’s previous track record is a good indicator of future behavior.
Request a cash deposit or money order from the foreign renters for both the deposit and rent payments. If there is a lack of credit history in the U.S., you have the right as a landlord to request cash or money order for the deposit and first month’s rent. Also, remember that you can’t take more than the one month’s rent and deposit equal to or less than the monthly rental rate – that is according to Hawaii state law.
Landlords can legally reject applicants on the basis of credit history or background but not because of age, gender, sexual orientation or other discriminatory reasons. Check with the U.S. Department of Housing and Urban Development (HUD) about discrimination policies in rental housing.