The Fair Housing Act (FHA) takes into consideration the interests of property buyers and renters to reduce discriminatory practices. As a rental owner, it's essential to know the basics of the FHA and how it will affect your rental business operation, whether you're compliant or not.
Being aware of the consequences will protect you from impending lawsuits, fines and reputational risks that can occur. So, developing a concrete understanding of the FHA will help you in the long run as a landlord.
This article will discuss 8 key pieces of information you need to learn regarding the FHA. It will ensure you're adequately prepared to manage your rental and escape losses that can result from negligence or ignorance of the statute.
Back in 1968, the need for a Fair Housing Act pushed it into creation. The FHA guards the interests of people desiring to buy, finance or rent a home by giving fair and equal treatment in terms of opportunity. Previously, sellers and landlords would only entertain buyers and tenants that they prefer. The FHA served to stop this discriminatory behavior and later in 1988, the FHA was amended.
The main purpose of the Fair Housing Act was to prevent housing discrimination of the protected classes. Otherwise, granting housing would only be for a selected few, making it unfair for some buyers and renters.
Seven classes are under protection of the FHA. The law was created to limit discrimination of the buyers and renters based on the following:
On a case-to-case basis, there may be exemptions under the Fair Housing Act:
As a landlord, awareness on what constitutes discriminatory actions will help you avoid breaking the law. Compiled below is a list of scenarios that represent unfair treatment of a person belonging to a protected class:
The HUD (Department of Housing and Urban Development) is tasked to handle all issues related to the Fair Housing Act. People who are victims of discriminatory practices under the FHA can make a complaint to HUD or proceed to court and file a case.
Normally, HUD proceeds with either of two strategies following a discrimination complaint under the Fair Housing Act.
Upon receiving a complaint from individuals who experienced FHA discrimination, the HUD will investigate the claim. The team will study the case and check for veracity. If a Fair Housing Act violation occurred, then HUD will come up with the proper solutions. They'll ensure that fair treatment is enforced.
HUD will send someone to act as a prospective renter to verify if discriminatory practices exist. Landlords can be found guilty through face-to-face or phone interactions. Marketing materials will also reveal if a landlord has violated the Fair Housing Act.
The penalties differ depending on the gravity of the discriminatory action. The amount of the fine will vary if the violation is simple or if it was committed for the first, second or third time.
As a landlord, it's your responsibility to fortify your knowledge of the FHA. Being more aware and strictly complying with the law will protect you from HUD complaints or lawsuits.
Here are key tips you can follow to prevent any FHA discriminatory accusations:
As a landlord, it's your duty to be a part of ending or reducing all forms of discriminatory practice when it comes to housing. Strictly adhere to the law and there won't be any worry over committing a violation. Here are key points to remember:
To help you remain compliant with the Fair Housing Act, Suncastle Property Management can assist as your property manager. We're ever ready to provide you with professional property management services to ensure your investment success.