This section provides an overview of the Fair Housing Act and its relevance to housing access for people with conviction histories. It also includes a discussion of the Fair Credit Reporting Act in the context of criminal background checks conducted by housing providers.
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April 11, 1968 |
Enactment of the Fair Housing Act, Title VIII of the Civil Rights Act |
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April 4, 2016 |
HUD issues Office of General Counsel Guidance on Application of Fair Housing Act Standards to the Use of Criminal Records by Providers of Housing and Real Estate-Related Transactions to stress the need for individualized assessment of housing applicants with convictions, so as to avoid racially disparate outcomes |
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April 12, 2022 |
HUD issues Eliminating Barriers That May Unnecessarily Prevent Individuals with Criminal Histories from Participating in HUD Programs, announcing agency-wide review of regulations, policies and guidance around consideration of convictions in applications and continued residence, to prevent unwarranted denials |
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June 10, 2022 |
HUD issues Implementation of the Office of General Counsel’s Guidance on Application of Fair Housing Act Standards to the Use of Criminal Records by Providers of Housing and Real Estate-Related Transactions to clarify legal standards |
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April 24, 2023 |
HUD announces future issuance of Notice of Proposed Rulemaking to change regulations for public housing agencies and subsidized housing providers, and the issuance of new guidance and technical assistance materials in response to agency-wide review |
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April 10, 2024 |
HUD proposed a rule that revises existing regulations determining how housing applications from people who have histories with the criminal legal system are to be considered. The intent is to “minimize unnecessary exclusions from these programs while allowing providers to maintain the health, safety, and peaceful enjoyment of their residents, their staffs, and their communities." |
88 Turner, T. (2023, April 26). HUD Rule Changes Will Ease Housing Barriers for Tenants with Criminal History, Officials Say. City Limits. https://citylimits.org/2023/04/26/hud-rule-changes-will-ease-housing-barriers-for-tenants-with-criminal-history-officials-say/?oref=csny_firstreadtonight_nl
Fair Housing Act
Title VIII of the Civil Rights Act, known as the Fair Housing Act (FHA), was enacted on April 11, 1968 – exactly one week after Dr. Martin Luther King, Jr. was assassinated, and after several years of Congressional struggle. The goal of the FHA is to prevent discrimination against people in renting or purchasing homes on the basis of their membership in a protected class, which includes race. The FHA governs all types of private and public housing, including federally subsidized housing programs operated by the Department of Housing and Urban Development (HUD).
Despite the limited number of mandatory, permanent exclusions, public housing authorities (PHAs) often impose more stringent requirements than what federal law requires by engaging in extremely broad interpretations of the law. While screening requirements vary across different federally assisted housing programs, there are generally only two categories of convictions for which PHAs must exclude people without considering any other circumstances: manufacturing methamphetamine on federally assisted property and sex offenses that require lifetime registration.
PHAs have discretion regarding the denial of applicants for being engaged in drug-related activity; violent criminal activity; or any other criminal activity that would “adversely affect the health, safety or right to peaceful enjoyment of the premises by other residents, the owner, or public housing employees.” Before denying an applicant, a PHA should take into account the length of time since the activity occurred, the seriousness of the activity, and any mitigating evidence of rehabilitation offered by the applicant.
On April 4, 2016, HUD issued an important memorandum asserting that although people with conviction histories are not a protected class under the FHA, a blanket ban on applicants with criminal convictions may constitute race-based discrimination in violation of the FHA:
(M)any formerly incarcerated individuals, as well as individuals who were convicted but not incarcerated, encounter significant barriers to securing housing, including public and other federally subsidized housing because of their criminal history … Across the United States, African Americans and Hispanics are arrested, convicted and incarcerated at rates disproportionate to their share of the general population. Consequently, criminal records-based barriers to housing are likely to have a disproportionate impact on minority home seekers.
In other words, this memo states that housing providers must consider additional factors beyond merely an applicant's criminal record when evaluating their suitability, or potentially run afoul of the FHA by producing a discriminatory effect.
In April of 2022, HUD Secretary Marcia Fudge called upon the agency to undertake a thorough review of all HUD policies and model documents to ensure that they are as inclusive as possible for people with convictions and their families. Secretary Fudge called for this review because “too many [public housing authorities, owners, and other HUD-assisted housing providers] continue to exclude people from desperately needed housing opportunities based on events that have little or no relevance to fitness to be a tenant.”
HUD later stated that private landlords should not use background checks at all because “(c)riminal history is not a good predictor of housing success,” and taking criminal convictions into account has a disparate impact on people of color. Finally, one year later, Secretary Fudge announced that the comprehensive review revealed the need for agency rulemaking to ensure that regulations and sub-regulations reflect the principle that applicants with convictions must be assessed in a holistic, individualized manner and not automatically denied, except in the few instances required by federal law. In April 2024, HUD published proposed rules for public comment and issued guidance and technical assistance to ensure PHAs and other HUD-affiliated housing providers can effectively implement the new rules.
It is important to note, as stated above in the 2016 memo, that denying housing on the basis of conviction history can have a racially discriminatory effect and violates the FHA; therefore, housing providers face legal liability if they adopt “blanket ban” policies. For example, The Fortune Society filed suit in the U.S. District Court for the Eastern District of New York against Sandcastle Towers Housing Development Fund Corp under the Fair Housing Act. It was alleged that in the summer of 2013 and early 2014, Fortune tried to rent apartments for its clients at Sandcastle, a multi-building apartment complex in Queens that the defendants own and manage. When Sandcastle learned that Fortune was seeking housing for formerly incarcerated individuals, they refused to rent apartments per the defendants' policy prohibiting anyone with a criminal record from renting an apartment or living at Sandcastle. This ban, Fortune alleged, was discriminatory and had an unlawful disparate impact on the basis of race and color. The case was settled in October 2019 with Sandcastle’s owners agreeing to pay $1,187,500 – one of the largest settlements in a case challenging a ban on renting to people with criminal records, if not the largest. The owners have sold the building and do not currently own or rent real estate.
Similarly, in 2023, The Fortune Society obtained a $500,000 judgment in a lawsuit against iAfford NY, LLC, which alleged that the affordable housing marketing agent excluded applicants with conviction histories from the affordable housing units in its portfolio in violation of the FHA. Failure to conduct individualized assessments of applicants with conviction histories, and instituting a blanket ban, is not only inhumane but can lead to substantial legal liability.
It is clear from the series of publications and announcements that HUD is moving towards less restrictive guidelines for public housing agencies and other HUD-funded housing providers. The message from HUD for all housing providers, even those not under its purview, is: housing providers should not exclude people solely on the basis of conviction history, as doing so reinforces racial inequities and does not promote public safety.
89 U.S. Department of Housing and Urban Development. (n.d.). History of Fair Housing. hud.gov/program_offices/fair_housing_equal_opp/aboutfheo/history
90 Tran-Leung, M. (2015). When Discretion Means Denial: A National Perspective on Criminal Records Barriers to Federally Subsidized Housing. Sargent Shriver National Center on Poverty Law. https://www.povertylaw.org/wp-content/uploads/2019/09/WDMD-final.pdf
91 Tran-Leung, M. (2015). When Discretion Means Denial: A National Perspective on Criminal Records Barriers to Federally Subsidized Housing. Sargent Shriver National Center on Poverty Law. https://www.povertylaw.org/wp-content/uploads/2019/09/WDMD-final.pdf
92 Tran-Leung, M. (2015). When Discretion Means Denial: A National Perspective on Criminal Records Barriers to Federally Subsidized Housing. Sargent Shriver National Center on Poverty Law. https://www.povertylaw.org/wp-content/uploads/2019/09/WDMD-final.pdf
93 U.S. Dept. of Housing and Urban Development. (2016, April 4). Office of General Counsel Guidance on Application of Fair Housing Act Standards to the Use of Criminal Records by Providers of Housing and Real Estate-Related Transactions. https://www.hud.gov/sites/documents/HUD_OGCGUIDAPPFHASTANDCR.PDF
94 U.S. Dept. of Housing and Urban Development. (2016, April 4). Office of General Counsel Guidance on Application of Fair Housing Act Standards to the Use of Criminal Records by Providers of Housing and Real Estate-Related Transactions. https://www.hud.gov/sites/documents/HUD_OGCGUIDAPPFHASTANDCR.PDF
95 U.S. Dept. of Housing and Urban Development, Office of the Secretary. (2022, April 12). Eliminating Barriers That May Unnecessarily Prevent Individuals with Criminal Histories from Participating in HUD Programs. https://www.hud.gov/sites/dfiles/Main/documents/Memo_on_Criminal_Records.pdf
96 Tuttle, S. & Rynell, A. (2019). Win-Win: Equipping Housing Providers to Open Doors to Housing for People with Criminal Records. Heartland Alliance. https://www.issuelab.org/resources/35116/35116.pdf
97 HUD Public Affairs. (2023, April 24). HUD Outlines its Action Plan to Remove Unnecessary Barriers to Housing for People with Criminal Records. U.S. Department of Housing and Urban Development (HUD). https://www.hud.gov/press/press_releases_media_advisories/hud_no_23_083
98 Relman Colfax. (2014). The Fortune Society v. Sandcastle Towers Housing Development Fund Corp. https://www.relmanlaw.com/cases-fortune
99 Relman Colfax. (2023, August 21). Relman Colfax Secures $500,000 Judgment Against Affordable Housing Marketing Agent that Categorically Excluded Applicants with Criminal Legal Involvement. https://www.relmanlaw.com/news-495
Fair Credit Reporting Act
The Fair Credit Reporting Act (FCRA) allows consumer reporting agencies to furnish information, upon request, “bearing on a consumer’s credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living which is used or expected to be used or collected in whole or in part for the purpose of serving as a factor in establishing the consumer’s eligibility for (A) credit or insurance to be used primarily for personal, family, or household purposes; (B) employment purposes; or (C) any other purpose authorized under section 604 [§ 1681b].”
Consumer reports are barred from including “civil suits, civil judgments, and records of arrest that ... antedate the report by more than seven years or until the governing statute of limitations has expired, whichever is the longer period,” and “any other adverse item of information, other than records of convictions of crimes which precede the report by more than seven years.”
Under the FCRA, housing providers must inform applicants when they collect information that could affect their eligibility, and they must receive written consent to run a background check. Failure to provide notice and obtain consent can lead to legal liability. If information obtained through a consumer report leads to an adverse decision, they must provide a copy of the report and notice of rights. The subject can file a dispute if there is incorrect or inaccurate information presented in the report. In reality many companies, including data brokers and others that landlords use to carry out background checks, are not consumer reporting agencies, as defined in the FCRA, and thus operate outside of its rules. However, it is important to note that even though many of these companies are not subject to federal regulation, relying on criminal record information provided by them to deny a housing application may still be deemed discriminatory under federal law, and perhaps state and/or local law.
The Consumer Finance Protection Bureau (CFPB) released a few reports discussing the prevalence of inaccuracies in private background checks. It has been well-documented that criminal background checks are rife with errors and therefore often do not provide accurate pictures of peoples’ criminal records. The CFPB has expressed particular concern about the way that inaccuracies tend to have a greater effect on racial minorities and low-income people.
In June of 2022, the CFPB released an interpretive rule that allowed for states to create their own laws surrounding consumer information protection, which is a potential opening for legislative implementation of HUD’s guidelines. The CFPB’s Tenant Background Checks Market Report from November 2022 cites HUD reports in reference to studies showing little to no value in using criminal background information to predict tenant outcomes.
Unless required by federal law, housing providers do not need to conduct criminal background checks. Doing so may lead to housing segregation based on race and also undermines public safety. For housing providers that choose to do so, it is crucial to understand the relevant federal, state and local laws governing the request and consideration of criminal background checks. It is also crucial to conduct an individual assessment of any applicant with a conviction history, which may not only insulate against liability under the Fair Housing Act but is also fundamentally the just thing to do.
Local and state laws across the country that regulate the circumstances under which housing providers can take criminal records into account vary widely. Some laws, often defined as “ban the box” laws, prohibit housing providers from checking an applicant’s criminal record until after a conditional acceptance has been tendered. Other laws consist of lookback periods within which a criminal background check may be run. The starting point for these periods also varies, from date of conviction to date of release from incarceration, and may also vary depending on the nature of the conviction. Some exclude certain housing stock from the law, usually based on owner-occupancy or number of units in the building.
For a full listing of these laws and an analysis of those that offer people the greatest access to housing as of December 2023, please see Appendix A.
100 The Federal Credit Reporting Act 15 U.S.C § 1681 § 603 d.1. (Version: May 2023) https://www.ftc.gov/system/files/ftc_gov/pdf/fcra-may2023-508.pdf
101 The Federal Credit Reporting Act 15 U.S.C § 1681 § 603 d.1. (Version: May 2023) https://www.ftc.gov/system/files/ftc_gov/pdf/fcra-may2023-508.pdf
102 The Federal Credit Reporting Act 15 U.S.C § 1681 § 603 d.1. (Version: May 2023) https://www.ftc.gov/system/files/ftc_gov/pdf/fcra-may2023-508.pdf
103 The Federal Credit Reporting Act 15 U.S.C § 1681 § 603 d.1. (Version: May 2023) https://www.ftc.gov/system/files/ftc_gov/pdf/fcra-may2023-508.pdf
104 Bureau of Consumer Financial Protection. (2021, November). Fair Credit Reporting; Name-Only Matching Procedures, 12 CFR Part 1022. https://s3.amazonaws.com/files.consumerfinance.gov/f/documents/cfpb_name-only-matching_advisory-opinion_2021-11.pdf
105 Brennan, C. (2023, April 17). Background Check Industry Profits Off ‘Digital Punishment,’ Despite Flawed Data. The Appeal. https://theappeal.org/criminal-background-checks-industry-for-profit/
106 Consumer Financial Protection Bureau. (2022, November). Tenant Background Checks Market. https://s3.amazonaws.com/files.consumerfinance.gov/f/documents/cfpb_tenant-background-checks-market_report_2022-11.pdf
107 Yu, P. & Dietrich, S.M. (2012). Broken Records How Errors by Criminal Background Checking Companies Harm Workers and Businesses. National Consumer Law Center. https://filearchive.nclc.org/pr-reports/broken-records-report.pdf
108 Bureau of Consumer Financial Protection. (2021, November). Fair Credit Reporting; Name-Only Matching Procedures, 12 CFR Part 1022. https://s3.amazonaws.com/files.consumerfinance.gov/f/documents/cfpb_name-only-matching_advisory-opinion_2021-11.pdf
109 Bureau of Consumer Financial Protection. (2022, June). The Fair Credit Reporting Act’s Limited Preemption of State Laws. https://files.consumerfinance.gov/f/documents/cfpb_fcra-preemption_interpretive-rule_2022-06.pdf
110 Consumer Financial Protection Bureau. (2022, November). Tenant Background Checks Market. https://s3.amazonaws.com/files.consumerfinance.gov/f/documents/cfpb_tenant-background-checks-market_report_2022-11.pdf