The Obama administration's latest warning to private landlords, that blanket prohibitions on renting to people with criminal convictions are illegal, was hailed by fair housing advocates as a seminal moment in the battle against racial discrimination.

Landlords have a different opinion to the instructions given by the Department of Housing and Urban Development on April 4. It said refusing to rent to people just because they have criminal convictions—for no other reason—is a violation of the Fair Housing Act, which prohibits discrimination on the basis of race, color, religion, sex, disability, familial status or national origin.

Although people with criminal convictions are not a protected class—because black and Hispanic people face disproportionately high conviction rates—blanket bans against renting to felons is viewed as discriminatory.

Landlords should review each case individually and take into account factors such as the severity of the crime, when it occurred, and what the person has done since then before making the decision on whether or not to rent to that person.

It is hoped that landlords will revisit their policies and evaluate if they can create instances of discrimination.

That's exactly what many landlords are doing, said Amy Glassman, a Washington lawyer who specializes in HUD compliance issues. "I don't think this should cause more concern because landlords have been concerned about this for some time," Glassman said.

"But if any client calls me to ask what to do with this, my general advice would be, 'If you don't have a written policy you need one, and make sure you're uniformly applying it to all applicants. And you need to include in the policy specific guidelines for what you screen out and what you don't.'

"So I don't think this represents a sea change, but it brings visibility to the issue and reminds landlords they need to be very thoughtful about how they're screening tenants."

That said, Glassman admitted the new guidance could be a useful tool in litigation.

"It puts things in writing and codifies HUD's position on the use of criminal background checks in screening potential tenants. If I was a plaintiffs' attorney, I'd cite this."

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