Q: In a recent column, attorney Mark Adamczyk answered a question about the legality of running credit checks on tenants who wish to rent in associations. Does your firm see many condominium documents that actually require the association’s Board of Directors to run a credit report on tenants? Tenants are not responsible for paying the association fees and there is no credit relationship between the association and a tenant. Further, if an association rejects a minority applicant because of his credit report, could this become a fair housing issue? As an aside, very few board members have experience in reading credit reports.
A: We have not seen many condo or HOA documents that require the association to obtain a credit report for tenants, but as explained in our August 26 column, it is a common practice to review a tenant’s credit history as part of the leasing application. Again, the association’s Board must have sufficient authority in the community documents and rules in order to request credit history and other background checks. We have dealt with unit owners who have made the same argument you make.
Their position is that the tenant’s financial condition is of no concern for the association and that only a criminal background check is possibly proper. We disagree somewhat. Many community associations we represent have found that both tenants and owners with a history of financial irresponsibility are less likely to follow the community rules. Further, if the owner defaults in the payment of assessments, the association does have the legal ability to garnish and collect rents directly from the tenant under Florida law. Thus, a reasonable argument can be made that credit history is an important factor for associations to consider. Certainly, if an association selectively reviews credit history based on the applicant’s race, religion or national origin, there will be a fair housing issue.