Have you recently received a denial on a rental application due to the results of an automated background check? If so, you’re definitely not alone. Through the past decade, more and more property managers have started using automated background checks during the application screening process.
By letting an outside system do the heavy lifting, they can skip all the judgment calls and just go with whatever the software tells them. Unfortunately, by removing the human element from the equation, people are getting denied due to unreasonable rulings and erroneous information. If this has happened recently, you will know the frustration of losing out on your ideal rental due to things outside of your control.
Thankfully, you do not need to keep going into the process simply hoping for the best. Here’s what you need to know to avoid this scenario in the future.
Denial Triggers for Automated Background Checks
In order to get your rental application approved, your income, credit score, and criminal history must align with the requirements set by the property management team. Evictions can also result in denials, depending on the rules associated with that property.
As far as your income goes, property managers may require that you make two to three times the rent each and every month. You may also need to have a credit score over 600 or whatever other thresholds they’ve set as their limit.
Your criminal history will likely need to be clear of all violent crimes, fraud, and other high-risk offenses. You need a positive rental history as well without any late payments, evictions, or property damage.
If the system finds that you do not perfectly meet the requirements set by the property manager, it will issue an immediate denial. Many companies will only go with the results from their program, even if there’s a reasonable explanation for the issue at hand.
How Removal of the Human Element Makes for Bad Decisions
With an automated background check, context doesn’t come into the picture. The system simply looks for the presence of red flag situations and bases the decision on whether they exist or not. If extenuating circumstances came into play, the software doesn’t yet have the capacity to adjust its understanding of risk.
Worse yet, background check systems do not double check that the information they’re using is even yours. It’s common for credit reporting agencies and similar entities to get everything mixed up since they do not always crosscheck birthdates, social security numbers, and other unique identifiers. And if you have a common last name, your risk of getting erroneous info mixed into your file is even higher.
You might then get denied due to someone else’s poor credit history, evictions, or criminal history. Most property management companies do not even allow applicants to challenge the results and ask for an independent review.
How to Best Avoid Automatic Rental Application Denials
Unfortunately, as the days get busier and busier, property managers are not likely to abandon the use of automated background checks. While you could look for companies that do their own independent checks, that greatly limits your rental options.
Instead, it’s important to make sure that your background check results are accurate and directly reflect your risk profile. If you get a denial, you have the right to see the background check results for yourself, according to the Fair Credit Reporting Act. You can then use their findings to start clearing up unfavorable and erroneous information used to determine their results.
If your credit score is too low, for example, you can pay off your debts and build a positive credit history to bring that number up. Remember to clear up debts as far as seven years back since that’s how long these automated background check systems are looking as well.
What to Do About Incorrect Info on Your Background Report
If the problem comes back to info that’s not even yours, then you’ll need to dispute the information to have it removed from your file. This is very important to do as soon as you realize it because the errors can end up costing you big time in the long run. And credit reporting agencies won’t fix the errors on their own. You have to speak up.
Once you challenge their results, the agencies are required to verify the info using additional sources and either correct it or remove it within the given time period. The burden of proof is on them, not you, though they may not always honor that requirement.
If you run into any problems while disputing the results, you can reach out for help from a skilled attorney. They will correspond with the reporting agencies on your behalf to help clear up any discrepancies in your file. Throughout that process, they will make sure that they abide by all the privacy rules and other regulations that protect your data and livelihood.
Need Help Remedying Incorrect Background Check Info?
If automated background checks are resulting in denials more often than not, it’s time to check out what’s going on. You can get the help you need from our team at The Cardoza Law Corporation. We will track down the issues and help you fix inaccurate line items in your credit report — with no money down. Just give us a call at 415-802-2799 or 213-474-3338 to get started.