How Long Should You Retain A Denied Rental Application?

I am often asked by landlords and rental property managers how long they should hold on to the rental applications of applicants that were denied.  

The answer to that question depends on something called the "statute of limitations."  A statute of limitation is a law which sets the maximum period of time in which a person can wait before filing a claim/complaint or lawsuit against another person.

The statute of limitations for a rental applicant to file a federal fair housing (discrimination) complaint against a landlord for failing to accept his/her application is 2 years.  The statute of limitations for a state fair housing (discrimination) claim to be filed is shorter -- only 1 year. 

So what this means to you is that you MUST retain all rental applications and any other related documentation, such as credit reports, criminal reports, questionnaires sent to current or prior landlords, CCAP printouts showing past evictions etc. etc., for at least 2 years from your last interaction with an applicant that did not become your tenant.  You will also want to save for the same period of time, the specific written screening criteria that you were using at the time that you processed and rejected the application.

If you fail to do this then you may end up in the unenviable position of trying to defend yourself against a fair housing (discrimination) claim brought by a disgruntled applicant that you have no memory of and you will not have any documentation that you can refer to in order to defend yourself.  While there is a strong likelihood that you will not remember each and every rental applicant that you have interacted with in the last 2 years, it is important to note that a denied applicant will always remember you because in their mind you are the person that denied them housing for discriminatory reasons.

You never, ever want to be stuck in a  "He Said, She Said" situation.  A "He Said, She Said" scenario is one where the denied applicant is saying that you denied their application for reasons in violation of the Fair Housing laws and all you can say in reply is "No, that is not true" but you have nothing but your word to refute the allegations.  Landlords and Property Managers always want to be in a position where they can produce written evidence to support their non-discriminatory reasons for denying an application.  And that can only be done if you retain all denied rental applications, written communications, and other relevant documents related to your decision, until the statute of limitations has run.