Selecting a qualified resident is one of the most consequential decisions a landlord makes. It’s also one of the most legally regulated. California has some of the most comprehensive fair housing and tenant screening laws in the country, and San Diego County adds a layer of local protections on top of state law. Getting the process right — from the application to the acceptance letter — protects your property and your compliance standing.
Start With Written Screening Criteria
Before you accept your first application, establish written screening criteria. This serves two purposes: it gives you a consistent framework for evaluating every applicant, and it protects you if a rejected applicant questions your decision. Your criteria should include income requirements (typically 2.5–3x monthly rent in verifiable income), credit standards, rental history expectations, and any other factors you’ll weigh.
Apply the same criteria to every applicant. Inconsistent application of screening standards is one of the most common ways landlords inadvertently run into fair housing exposure.
Application Fees: What You Can and Can’t Charge
California limits application fees to the actual cost of the screening — or a statutory cap that adjusts annually for CPI (approximately $65–$70 in recent years). You must provide each applicant with a written receipt and, if you don’t select them, an itemized accounting of how the fee was spent. If you don’t actually run a credit check, you cannot keep the fee.
You can only charge one application fee per unit per vacancy, and you must process applications in the order received if you charge fees — or screen for free.
What You Cannot Consider
California’s Fair Employment and Housing Act (FEHA) and San Diego’s local fair housing ordinances prohibit discrimination based on a significant list of protected characteristics. At the state level, these include race, color, religion, sex, national origin, disability, familial status, source of income, and several others. San Diego County extends protections further.
Source of income is worth highlighting: in California, you cannot refuse to rent to someone because they receive housing vouchers (Section 8/HCVP) or other public assistance. You can apply your standard income verification process, but the source of that income is not a disqualifying factor.
Criminal History and the “Individualized Assessment” Standard
California law significantly limits how landlords can use criminal history in screening decisions. You may not use arrest records that did not result in conviction. For convictions, you must conduct an individualized assessment — considering the nature of the offense, how much time has passed, and evidence of rehabilitation — rather than applying a blanket policy.
Developing a defensible, written criminal screening policy is advisable before you begin evaluating any applications. Blanket policies excluding all criminal history are unlikely to survive a fair housing challenge.
A practical note: given the strict individualized assessment standard in California, many experienced property managers in San Diego have concluded that running criminal background checks adds legal complexity without proportionate benefit. If a criminal screening policy is challenged and found to have a disparate impact on a protected class, the burden shifts to the landlord to prove it is necessary and narrowly tailored. For landlords who are not prepared to defend that analysis, foregoing criminal history checks entirely — and focusing screening on income, credit, and rental history — is a reasonable and defensible approach. Consult with a fair housing attorney or licensed property manager before deciding how to handle criminal history in your screening process.
Credit and Income Verification
Credit reports and income verification remain appropriate parts of a screening process when applied consistently. Use a reputable tenant screening service, document what you pulled and when, and keep records of your decisions. If you deny an application based in whole or in part on a credit report, you must provide an adverse action notice — including the name and contact information of the reporting agency.
One important exception applies to applicants using Section 8 housing vouchers or other government rental assistance: these applicants may decline to have their credit run. Effective January 1, 2024, California law (SB 267) prohibits landlords from using credit history as the sole basis for evaluating Section 8 voucher holders. Landlords must offer applicants the option to provide alternative evidence of ability to pay—such as bank statements or pay stubs—and consider this evidence instead of a credit score.
Resident selection is where long-term performance begins. The time spent building a lawful, consistent screening process pays back many times over — in better-qualified residents, lower turnover, and defensibility if a decision is ever questioned. |
The Bottom Line
Legal tenant screening in California is built on three pillars: written criteria applied consistently, prohibited factors that never enter the decision, and proper documentation of every step. The process isn’t complicated, but it requires attention to the details before the first application comes in — not after.
Here’s what we’d want to know if we were in your position: Are your screening criteria written down and applied consistently? If not, that’s the right place to start. |