Landlords Pay $23K to Settle Credit Reporting Violations, Discrimination Claims

June 26, 2014
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Two Massachusetts property owners have agreed to pay $23,000 to resolve allegations of housing discrimination and credit reporting violations, according to a recent announcement by Massachusetts Attorney General Martha Coakley.

The complaint alleged that the couple, who owned and managed a four-unit rental in Western Massachusetts, refused to rent to a 59-year-old prospect due to his mental disability and receipt of rental assistance. They were also accused of violating federal and state law by failing to provide applicants with an “adverse action notice” that their rental applications were denied because of poor credit histories.

Under Massachusetts state law, it’s illegal to discriminate against housing applicants because they receive public assistance or because of a disability. It’s also a violation of the state Consumer Protection Law and the Fair Credit Reporting Act to fail to provide adverse action notices to prospective residents whose rental applications are denied because of their credit histories. Consumers must be provided with a notice of negative decisions based on their credit histories so that they have the opportunity to correct inaccurate or incorrect information. 

Under the settlement, the landlords agreed to pay $16,000 to the prospect and to notify him when any one-bedroom or studio apartment becomes available in the building. They also agreed to pay $5,000 to the Massachusetts Fair Housing Center and $2,000 to the Commonwealth. In addition, the landlords agreed to adopt a credit-screening policy that requires them to: (1) send adverse action notices to any applicant who is denied a unit due to credit history, and (2) use an alternative process for determining whether a resident who receives public assistance has the ability to pay rent.

“Equal and fair access to housing is a right of all residents of the Commonwealth,” Coakley stated. “Massachusetts residents must be provided with proper notice about the use of their credit histories in housing decisions so that they can make sure that landlords base their decisions on reports that are accurate.”

Source: Massachusetts Attorney General’s Office