This post covers the rental application denial letter.
As a potential landlord or property manager, you will be receiving a lot of rental application letters for your available spaces.
Not all of them will meet your rental requirements and win.
In fact, many of the applications deserve a denial.
The most crucial thing to keep in mind is that you must decline a tenant’s rental application in a fair, professional, and lawful manner.
Of course, it is your choice to keep quiet or inform the applicant that he has been denied.
If you have chosen to keep quiet, this post is not for you.
But if you really need to inform the applicant about the denial then you have to write a formal letter to that effect-rental application denial letter
Here I will show the best and most legal way to do it.
In addition to the free sample rental application denial letter, I will also take you through;
- What is a rental application denial letter?
- Why do you need a rental application denial letter
- How to legally deny a rental applicant
- How to write an effective rental application denial letter
- rental application denial letter samples
let’s get started
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What is a rental application denial letter?
A rental application denial letter is a brief statement of facts written by a landlord or property manager to reject a rental application that doesn’t meet his/her rental requirements.
This letter notifies an applying tenant that his rental application has been rejected and explains why.
Why do you need a rental application denial letter?
The following are the reasons why you need to write a rental application denial letter
- A rental application denial letter is a professional and legal way to respond to a denied applicant.
- It is an opportunity to show the applicant that you consider his application
- Through a well-written rental application denial letter, the applicant can clearly see why he has been denied and explore the area in which he should improve in his renting process.
- A rental denial letter can also protect you from accusations of discrimination because it outlines the reasons why a renter was rejected for the property.
How to legally deny a rental applicant
Denying a rental application has some legal implications, and doing so arbitrarily might result in serious issues including discrimination claims.
Here are some safe ways to reject a rental application to assist you in avoiding both legal and non-legal issues.
Denying a renter due to a bad credit report
According to § 615 (a) of The Federal Fair Credit Reporting Act you are required to give the applicant an Adverse Action Notice if turned down due to information in their credit report.
An adverse action notice informs the renter that his application was rejected as a result of data from a consumer credit report and provides contact information for the credit reporting organization utilized so the applicant can also examine the report.
If a tenant contacts you to complain that information on their credit report is incorrect, you should suggest that they review the Adverse Action Notice you gave them and get in touch with the credit reporting agency directly to find out how to have the information corrected.
Deny a renter due to dangerous criminal records
Only dangerous criminal convictions that might endanger the safety of the rental, other tenants, or the community may be used as grounds for rejecting an applicant.
Arrest records may not be used to assess a rental applicant’s eligibility.
According to the U.S Department of Housing and Urban Development:
- An arresting history is not a good enough basis to turn down a renter.
- If convicted offenders’ convictions were obtained for a purpose that blatantly puts your community’s citizens and/or property in danger, you may refuse to rent them.
- Blanket statements like “Any criminal convictions will be refused” in your screening criteria are now viewed as discriminatory and against the Fair Housing Act.
If you reject a rental applicant because of details discovered in a public record (such as a criminal background check or eviction search), you must give them a denial letter and directions on how to get a copy of the report.
You only need to let the applicant know which agency you utilized to acquire the report and who to contact if they want a copy; you don’t even need to give them a copy.
Denying a renter due to insufficient income-to-rent ratio
You have the right to lawfully reject a tenant’s application if they don’t match your conditions for renting.
Many landlords frequently demand that a renter earn three times the rent. To prove that they have enough money to cover the cost of rent, an application should give you proof of income, such as pay stubs, bank statements, or a job offer letter.
It becomes questionable if a renter will be able to pay rent in whole and on time each month if their income falls below your income-to-rent threshold.
Denying renter due to availability
Rental applications should be approved on a first-come, first-served basis by housing providers.
First come, which refers to the most qualified candidate (not the first applicant).
This inevitably means that you will have to reject a deserving applicant only because another got accepted before them.
Make sure to explain the situation if you are turning down a rental applicant because a property is no longer available.
You can inform them that while they were granted the property, another application received approval prior to you.
Additionally, you may guide them on how to apply for a different home you manage.
Denying renter due to poor rental history
You can tell if a prospective tenant will be a good fit for you and your rental property by looking at their prior renting experience.
It is acceptable to reject a renter’s application if they have a history of evictions, unpaid rent or fees, or property damage.
Fair Housing Laws forbid you from employing discrimination in your decision to decline a rental application, which includes the following:
- National Origin
- Familial Status
How to write an effective rental application denial letter
A rental application denial letter is written in business letter format. Begin with your address and contact information, followed by a date and the applicant’s address, thank the recipient for his application, and inform him that his rental application has been denied due to some specified reasons. Finish with “Sincerely,” your signature, and your name.
REMEMBER the main purpose of your rental application denial letter is to inform the applicant that his application has been denied based on the specified reasons
So, to write an effective rental application denial letter, I propose that you follow the guidelines below;
- Provide your name/organization, address, and contact information
- Include the date of the letter
- Include the applicant’s name and address
- Appreciate his application.
- State clearly that his application has been denied
- Provide the reason for the denial
- Where necessary make reference to relevant documentation (credit report, criminal records, etc.)
- Attach relevant documents- credit reports, etc.
- Provide the right to appeal against your decision
- Be straightforward
- Maintain a professional tone
- Be honest
Rental application denial letter sample
58 Middle Point Rd
San Francisco, CA 94124
December 30, 20…
4 Fern Rd.
Greenbrae, CA 94904
Dear Mr. Blair
We appreciate your interest to rent the property situated at 212 Rey St, San Francisco, CA 94134 and thank you for completing the whole application process. Unfortunately, we have decided to reject your application for the following reasons.
- Your credit history is not acceptable
- Employment details were insufficient
- Your gross income is not adequate
You have 45 days to reply to this letter in order to contest or appeal this decision if you disagree with the reasons given for the denial of your application. You can reach me at the phone number or email I’ve provided above.
[The following paragraph is relevant only when you reject a renter based on a poor credit score]
We are bound by the Fair Credit Reporting Act to disclose to you where we obtained your credit report if we reject you due to poor credit. This decision was made using the following screening service: [Screening Service].
Some of the data gathered by the aforementioned screening service may have come from one or more of the credit bureaus listed below. Keep in mind that these institutions had no involvement in the decision-making process and will not be able to provide an explanation. The following list of credit bureaus were utilized to gather this data: [Credit Bureau Name, Contact Information, etc.]
You have the right, under federal law, to contest any information given by one of these organizations and to remedy any errors in the report. You have 60 days following receipt of this notice to seek a free copy of the report and make an appeal regarding the report’s accuracy or thoroughness.
If appropriate, you might also be entitled to further protections listed in your state’s laws and rules that weren’t included here. You can speak with your local Attorney General’s Office or Consumer Protection Agency to learn more about such rights.
Please do not hesitate to contact me if you have any further questions or concerns about this letter.
Rental application denial letter pdf