By: Lesley Fair | Apr 3, 2013 11:13AM
Funny thing about the Fair Credit Reporting Act: It’s been around since 1970, it’s broad in scope, and yet a lot of businesses with obligations under the law may not be focusing on compliance. Warning letters the FTC just sent to six companies in a particular line of work underscore the need to double-check your FCRA responsibilities.
The letters went to companies that collect information about tenants’ rental histories and then share it with prospective landlords thinking about renting to a certain tenant. According to FTC staff, “If you assemble or evaluate information on individuals’ rental histories and provide this information to landlords so that they can screen tenants, you are a consumer reporting agency (CRA) that is required to comply with the FCRA.”
That kicks in certain requirements designed to protect the privacy of people whose information is collected. For example, companies collecting and sharing that information have an obligation to make sure that whoever is asking has a legitimate reason — a “permissible purpose” — for getting the info. It’s probably OK if it’s to screen prospective tenants, but what about pretextual reasons like snooping on a neighbor or for marketing purposes? Put that in the NOPE category.
Companies compiling the information also have an obligation to ensure it’s as accurate as possible. If consumers ask, they have to give them copies of their reports and allow them to dispute anything that might be inaccurate.
Companies also have a legal obligation to remind landlords of certain responsibilities they have under the FCRA. For example, if a landlord denies housing on the basis of information in a report, the landlord has to notify the applicant of that fact, give the applicant information about how to get a free copy of their report, and tell them how to dispute info the applicant thinks may be inaccurate.
Here’s who got the warning letters:
- The BlueChip Group LLC – donotrentto.com
- M & R Rental Properties – badtenantlistings.com
- The Landlord Protection Agency – thelpa.com
- National Tenant Network – ntnonline.com
- 123 Rent Inc. – therentersblacklist.com
- Tenancy Bureau Inc. – tenancybureau.us
The letter make it clear that the FTC hasn’t evaluated the companies’ practices to determine if they’re complying with the FCRA, but suggests they visit the Credit Reporting page in the BCP Business Center for FCRA compliance resources.
Not a bad idea, we say.
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Comments
German investor replied on Permalink
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Deisel2015 replied on Permalink
I am wondering if there are any agencies that are in good standard with FTC to collect bad rental debts from deadbeat tenants. I thought this site could help me.
Renter replied on Permalink
I have been renting from an individual investor for the last two years and payments are made directly to them. I would like the timely payment to be reflected on my credit report and I do not want to have to 'pay' a fee to do it. Is there a way to have the information sent to the credit reporting agencies that do not cost me or my landlord anything. I already know that my landlord is not willing to pay for credit reporting rent collecting company.
Joann replied on Permalink
I feel there needs to be a federal statute that protects tenants renting homes against landlords who refuse to return deposits. They are becoming scammers by abusing the deposit demanding it be used against utility bills that are in the owners name . Landlords have been deposit opportunists for many many years and are getting away with keeping the deposit where unwarranted. Some refuse to renew your lease this is a red flag that they have no intention of returning your deposit. Others do the same and do not upkeep the property later using any defects that were there prior to a tenants rental later , against the tenant . I am being asked to move out after being told in writing that I can stay until the fall . After I paid the rent I was then told move out as soon as possible or I will have my lawyer evict you . Mind you there is no default in rent nor utility . Landlord simply wants my deposit. Federal Trade can intervene . This needs to be addressed quickly to protect tenant consumers from contract fraud, theft, scam and financial abuse.