Charlotte rental prices are at all-time highs. Rent has gone up by more than 20% since 2020. And unlike the rest of the nation, the Charlotte rental market shows no signs of letting up.
If you price your units right, you can expect applications to pour in. That makes now the perfect time to start brushing up on tenant screening laws that apply to your Charlotte rental property.
Here are four of the most important landlord-tenant laws to know about screening tenants in North Carolina.
1. Application Fee Laws
In North Carolina, landlords can legally charge application fees. Unlike some states, North Carolina does not place restrictions on how much you can charge prospective applicants for the tenant screening process.
Additionally, the Tar Heel State has no requirement for application fee refunds. That means you can legally withhold the fee for processing and other services even if you do not approve the applicant for tenancy.
2. Criminal History Inquiry Statutes
Criminal history inquiries are crucial if you want to avoid bad tenants. However, running criminal history checks is not as cut and dry as application fee laws in North Carolina.
First of all, landlords must always get permission from the applicant to run the check. Getting consent can be as simple as including a tenant background check addendum with a place for the applicant's signature.
Additionally, landlords cannot order criminal history inquiries selectively. In other words, if you want to run criminal background checks, you must do so for every applicant, or you risk running afoul of the Fair Housing Act (more on this later).
One final consideration is how landlords can legally use information obtained from a criminal background check. Specifically, landlords can only reject an applicant based on past convictions that are legitimate business concerns.
3. Credit Reporting Regulations
Credit reports can help landlords understand an applicant's ability to pay rent. They are allowed in Charlotte as long as the applicant consents to the landlord running their credit.
Also, keep in mind that you must have consent from all applicants you intend to run a credit check on. It is not sufficient for one applicant to give consent in place of the other parties involved.
4. The Fair Housing Act
While not a law specific to North Carolina or Charlotte, the Fair Housing Act applies to all landlords in the United States. It is a federal law forbidding landlords from discriminating against prospective tenants.
The Fair Housing Act makes it illegal to discriminate on the following basis:
- Nationality (or nation of origin)
- Family status (e.g., married vs. unmarried)
- Disability (physical or mental)
You may think the Fair Housing Act is no big deal. But considering that landlords across the US paid hundreds of thousands of dollars to Fair Housing Act plaintiffs in 2023 alone, you may want to think again.
Need Help With Tenant Screening in Charlotte, NC?
Tenant application fees are legal in North Carolina, but running criminal background checks and credit reports is trickier to manage. Landlords should also be aware of the Fair Housing Act and how it impacts tenant screening.
Are you tired of tracking Charlotte's ever-changing tenant screening regulations? Property Management, Inc. Charlotte can help you stay up-to-date. Contact PMI Charlotte to learn more about our tenant screening services.