A landlord can deny a tenant for criminal history, but only through a screening process that evaluates each applicant individually and complies with federal, state, and local law. Criminal history is not a protected class under the Fair Housing Act, so considering it is not automatically illegal. What gets landlords in trouble is how the consideration is done: blanket bans, inconsistent treatment, reliance on arrests rather than convictions, and missing paperwork after a denial all create real legal exposure.
What Federal Law Actually Says
The Fair Housing Act prohibits discrimination based on race, color, national origin, religion, sex, familial status, and disability.1Office of the Law Revision Counsel. 42 USC 3604 – Discrimination in the Sale or Rental of Housing and Other Prohibited Practices Criminal record is not on that list. A landlord is free to weigh convictions as part of a screening decision, provided the way they do it does not produce discriminatory outcomes against protected groups.
The FHA contains one explicit exception for criminal conduct. A landlord can deny an applicant convicted of illegally manufacturing or distributing a controlled substance without any fair housing liability.2Office of the Law Revision Counsel. 42 USC 3607 – Religious Organization or Private Club Exemption That carve-out is narrow. It covers drug production and distribution. It does not cover drug possession, drug use, or any other category of offense. Every other conviction has to be handled under the general framework described below.
Why Blanket Denials Get Landlords Sued
Even though criminal history is not itself protected, a policy that automatically rejects every applicant with a record can still violate the FHA under a theory called disparate impact. Arrest and conviction rates fall unevenly across racial and ethnic groups, so a screen that rejects everyone with a record will reject members of some protected classes at higher rates than others. That counts as illegal discrimination even when the landlord had no intent to discriminate.
HUD’s current regulation uses a three-step test. The person challenging the policy must show it produces a discriminatory outcome. The landlord then has to prove the policy serves a substantial, legitimate, nondiscriminatory interest. Even if the landlord clears that bar, the challenger can still win by showing a less discriminatory alternative would serve the same interest.3Federal Register. HUD’s Implementation of the Fair Housing Act’s Disparate Impact Standard In plain terms, a policy that rejects any felony from the last twenty years with no distinction between a decades-old theft and a recent violent offense is very hard to defend.
One note on the current regulatory picture. In January 2026, HUD proposed removing its disparate impact regulations from the Code of Federal Regulations.3Federal Register. HUD’s Implementation of the Fair Housing Act’s Disparate Impact Standard As of early 2026, the 2023 version of the rule is still in effect, and the FHA statute itself has not changed. The Supreme Court recognized disparate impact claims under the FHA in 2015, and private plaintiffs and state attorneys general can still bring them regardless of what HUD does with its own regulation. A landlord who treats the regulatory shift as a green light for blanket denials is taking a serious risk.
Arrests Are Not Convictions
An arrest without a conviction is especially weak ground to deny housing. An arrest reflects a law enforcement decision, not a finding of guilt, and HUD has stated that arrest records alone are not reliable evidence that a person engaged in criminal activity. Some jurisdictions prohibit using arrest records in housing decisions outright. Even where no local ban exists, arrest rates track more unevenly across racial groups than conviction rates do, which deepens the disparate impact problem. Limit screening to actual convictions.
State and Local Fair Chance Laws
Federal law is only the floor. At least fifteen cities and counties have passed “fair chance housing” laws that impose additional restrictions, and the number is growing. The specific rules vary, so landlords need to check the law where the property is located, not just the state they live in.
Common restrictions include:
- Lookback limits that bar considering convictions older than a set period, typically three to seven years.
- Prohibitions on considering arrests without convictions, sealed records, expunged records, and juvenile adjudications.
- Rules against asking about criminal history on the initial application, requiring the landlord to run a background check only after making a conditional offer.
- Caps on background check fees charged to applicants, ranging roughly from $20 to $90 depending on the location.
Violating a local ordinance brings its own penalties on top of any federal liability. These laws also change often. If you own property in more than one jurisdiction, review your screening policy at least annually.
Building a Screening Policy That Holds Up
A written screening policy applied to every applicant is the foundation of defensible denials. Without one, there is no way to show that decisions are consistent rather than targeted. The policy should be specific enough to drive real decisions, not a vague statement about community safety.
Define a lookback period. Five to seven years for felonies and two to three years for misdemeanors is a common range, subject to any shorter limits in your jurisdiction. Identify which categories of conviction are actually relevant to a rental environment. Offenses involving violence against people, property destruction, and drug manufacturing or distribution have the clearest connection to tenant safety. A years-old financial crime unrelated to paying rent is harder to justify as a disqualifier.
Apply the policy consistently. Waiving a conviction for one applicant and holding a similar one against another is exactly the pattern discrimination claims are built on. Keep the written policy on file and be ready to show it was followed for every applicant you screened.
The Individualized Assessment
A policy catches the easy cases. Most real decisions sit in a gray zone where the facts of the specific applicant matter, and this is the step landlords most often skip. It is also the step that matters most when a denial is challenged.
When a background check turns up a potentially disqualifying conviction, notify the applicant and give them a reasonable chance to respond. They may offer context about the offense, proof of rehabilitation such as completion of a treatment program, a steady work history since the conviction, or references from prior landlords. Refusing to consider that information makes a denial much harder to defend.
Weigh at least three factors: the nature and severity of the offense, how much time has passed since the conviction, and whatever the applicant provides about their circumstances since then. Someone convicted of a property crime eight years ago who has held steady housing and work since release presents a very different risk than someone with a recent violent felony. Write down what you considered and why you reached the decision you reached. That record is your best protection if the applicant files a complaint.
FCRA Notice After You Deny
Whenever a landlord uses a report from a third-party screening company to deny an application, charge a higher deposit, or require a co-signer, the Fair Credit Reporting Act requires an adverse action notice to the applicant.4Federal Trade Commission. Using Consumer Reports: What Landlords Need to Know This obligation is separate from fair housing law and applies whether the denial was based on criminal history, credit, eviction records, or anything else in the report.
The notice must include:5Office of the Law Revision Counsel. 15 USC 1681m – Requirements on Users of Consumer Reports
- The name, address, and phone number of the consumer reporting agency that provided the report.
- A statement that the reporting agency did not make the denial decision and cannot explain it.
- Notice that the applicant can request a free copy of the report from the screening company within 60 days.
- Notice that the applicant can dispute the accuracy or completeness of the report with the screening company.6Consumer Financial Protection Bureau. What Should I Do if My Rental Application Is Denied Because of a Tenant Screening Report?
The notice can be given in writing, electronically, or orally, though written delivery creates the clearest record. The requirement is triggered whenever a consumer report played any role in the decision, even a partial one. A landlord who runs a background check, sees a conviction, and denies the applicant without sending this notice has violated federal law regardless of whether the underlying denial was otherwise justified.
One boundary worth noting. The FCRA’s pre-adverse-action notice, which lets a person review the report before a final decision, applies in the employment context, not housing.7Office of the Law Revision Counsel. 15 USC 1681b – Permissible Purposes of Consumer Reports Federal law does not require landlords to send a pre-denial notice, though the individualized assessment described above serves a similar function in practice. Some local fair chance laws do impose a pre-denial notification step, so check your jurisdiction.
What Violations Cost
Fair housing complaints can be filed with HUD, pursued by the Department of Justice, or brought as private lawsuits. Under the FHA, civil penalties in cases brought by the Justice Department start at up to $50,000 for a first violation and up to $100,000 for subsequent violations.8Office of the Law Revision Counsel. 42 USC 3614 – Enforcement by the Attorney General Those base amounts are adjusted periodically for inflation, which pushes the actual figures higher. A landlord may also owe compensatory damages for the applicant’s out-of-pocket costs in finding other housing and for emotional distress.
FCRA violations stack separately. A landlord who fails to send a proper adverse action notice can face statutory damages, actual damages, and attorney’s fees. Class action exposure is real when the same defective notice, or no notice at all, affects many applicants.
A single botched denial can trigger a fair housing claim and an FCRA claim at once. The legal fees of defending both typically dwarf whatever the landlord saved by shortcutting the screening process in the first place.