Tenant Background Check Colorado

What Colorado Tenant Screening Covers

Tenant background checks complement rental applications by digging into national databases to verify and expand on the details the applicant provided on the form.

When you use property management software like TurboTenant to process applications, you can pair a tenant background check Colorado landlords can trust with the application itself, keeping all relevant information in one secure place.

A tenant background check typically covers:

Criminal history: A tenant screening report often includes a look into the applicant’s criminal history. Each state sets different rules on how you can use this information and how far back you can look. Criminal history reports often include:

• Felony and misdemeanor convictions
• Active warrants out for the applicant
• Relevant court records
• Sex offender and FBI database reports
• Arrest records (though many states don’t allow landlords to consider this if the arrest did not result in a conviction, including Colorado)

Credit history: A credit check is a key part of a tenant background check that Colorado landlords can use to verify an applicant’s financial information. It also helps you review their credit history. A credit report typically includes:

• The credit score of the applicant
• Available lines of credit
• Recent credit inquiries
• Outstanding debt in collections

Eviction history: Eviction history is another key area that a tenant background check will cover. TurboTenant’s screening report reviews over 27 million eviction records across all 50 states and Washington, D.C. The eviction section of a screening report will include:

• Eviction by a previous landlord for failing to pay rent
• Judgments for rent, possession, and money
• Unlawful detainers filed against the applicant
• Any Writs and Warrants of eviction issued

Rental history: Tenant screening reports also include the tenant’s previous rental history for verification.

Income verification/fraud detection: As a Pro feature, TurboTenant uses Snappt to verify income and detect fraud. With a 99.8% accuracy rate, you can rest assured.

References: Many landlords supplement the application and screening reports with references from employers, past landlords, or personal sources.

Federal Tenant Background Check Laws

Because you’re handling sensitive personal and financial data, you must follow federal laws and guidelines throughout the process.

Fair Credit Reporting Act: The FCRA requires landlords to obtain written consent before running a credit check on an applicant. If you deny the application due to poor credit history, you must issue an Adverse Action notice. This notice must explain the denial and include the name, address, and contact information of the agency that provided the report.

Fair Housing Act: It’s illegal to discriminate against an applicant based on race, color, religion, sex, national origin, or familial status. The FHA prohibits landlords from denying applications or advertising rentals in a way that shows preference for or against any protected class.

HUD guidelines: Landlords may not deny all applicants with a criminal record, and blanket bans are illegal. You must give reasonable consideration based on the nature, severity, and timing of the offense. Arrests without convictions cannot be the sole reason to deny an applicant.

Colorado Laws

Federal guidelines aren’t the only rules Colorado landlords must follow when conducting a tenant background check. Many states also pass laws that dictate how landlords can qualify an applicant for a property.

In 2020, Colorado passed the Rental Application Fairness Act, which significantly impacts what information Colorado landlords can consider from a tenant background check.

Criminal history: Colorado landlords can ask about an applicant’s criminal history, but only after making a conditional lease offer. They may only consider convictions from the past five years unless the offenses involve meth manufacturing, homicide, stalking, or sex-offender registration. If you deny an applicant for this reason, you must make a good-faith effort to provide written notice within 20 days of the denial.

Fair Chance Housing: Colorado does not entirely ban questions about an applicant’s criminal history (known as “ban the box”), but it does heavily restrict how you can use that information. You cannot consider sealed, vacated, nullified, or expunged records. Juvenile adjudications or delinquency also generally cannot be used, as the courts seal most.

State-specific Fair Housing additions: Colorado has added several protected classes to those listed in the federal Fair Housing Act. These include source of income, sexual orientation, gender identity, gender expression, marital status, and creed.

State-level notices/disclosure requirements: Colorado requires landlords to accept a portable tenant screening report if the renter initiated it within the last 30 days. The report must include income and employment verification, as well as rental, credit, and criminal history, although some exceptions apply. Additionally, landlords must give every denied applicant a written denial notice that clearly states the reason for the denial.

Reusable tenant screening reports: While some states allow landlords to use reusable tenant screening reports, they must stay up to date on this topic. Laws around how and if landlords can use these reports change frequently.

Red Flags to Watch Out For

While landlords must apply all criteria to each applicant individually and equally, some common red flags could still signal a bad fit.

Late payments or collections: An applicant with a history of late payments or debt in collections could signal ongoing cash flow issues. It may also suggest they don’t consistently pay bills on time.

History of evictions: While you must handle eviction history carefully, an applicant with multiple evictions could suggest future problems. These potential issues are especially relevant if the evictions involved non-payment of rent or repeated lease violations.

Unverifiable income: If you can’t verify an applicant’s income, it could mean they inflated their worth on the application. It may also suggest they receive money from unverifiable sources, which could lead to other problems.

Inconsistent rental history: An applicant with an inconsistent rental history may present challenges or have a pattern of breaking leases or facing evictions.

Criminal charges: Criminal charges that don’t lead to a conviction cannot serve as the sole reason to deny a rental application. However, an extensive criminal history may indicate future issues. Make sure to follow all federal and state laws when using this information to deny an application.

How To Legally Run a Background Check

When running a tenant background check, Colorado landlords should follow all state and federal guidelines as part of the Colorado tenant screening process. Using platforms like TurboTenant can help streamline tasks and keep everything organized in one easy-to-use system.

As a reminder, here’s how to conduct Colorado tenant screening:

• Obtain written consent from the applicant before beginning the screening process.
• Use a verified tenant background check service, such as TurboTenant, to ensure accurate and compliant Colorado tenant screening.
• Verify their identity using a Social Security number and valid identification.
• Review the screening report, including credit, eviction, and criminal history.
• Evaluate each applicant using consistent criteria to ensure fairness and compliance.
• Issue an Adverse Action notice if rejecting an applicant due to poor credit, including required details.
• Streamline the process by using TurboTenant to manage the full Colorado tenant screening workflow in one place.