Housing Law: SB 267 - Credit History of Persons Receiving Government Rent Subsidies

Qualifying for a housing rental requires a prospective tenant to have a good credit history and provide this information to the landlord, among other requirements. When a credit score is poor or there is a lack of credit history, the prospective tenant may be denied housing because they do not meet the rental requirements.

As of January 1st of 2024, Senate Bill 267 provides additional protection for tenants who receive rent subsidies from the government. With this bill, landlords must consider an alternative verifiable document in lieu of credit history as part of the application process for tenants receiving government rent subsidies. Using poor credit history or lack of credit history as a reason to reject tenants that receive government rent subsidies has historically been a way that some landlords have attempted to circumvent the unlawful advertisement of statements like “No Section 8” or “No Housing Vouchers”.

Therefore, with this bill, instead of credit history, the prospective tenant will have to provide lawful alternative information that shows their reliability to pay their portion of the rent. For instance, if a property has an income requirement of 2x the rent, it would now only be true for the tenant's portion of the rent. For example, the rent is $2,100, and the tenant who receives a rent subsidy only pays for a portion of the rent (in this example 30%). 30% of $2,100 is $630. This means that the tenant would only need to make 2x $630 (the tenant’s portion of the rent) = $1,260. Thus, it would be incorrect to expect the tenant to meet the 2x requirement for the full amount of rent.

In addition, the alternate forms of documentation could look like, but are not limited to, bank statements, pay stubs/pay records, and government benefit payments. Furthermore, if the prospective tenant elects to provide the alternative lawful evidence, the landlord must give a reasonable time for the tenant to provide the information. The landlord must also reasonably consider this information in place of the credit history.

CSA San Diego County is a fair housing nonprofit organization dedicated to the eradication of discrimination in housing. If you or someone you know has faced or is facing housing discrimination or would like to learn about fair housing rights, we encourage you to call CSA San Diego County. Our counselors are available to assist you via phone, email, or in person. You can contact us at (619) 444-5700, visit our website at www.c4sa.org, or visit our office at 327 Van Houten Avenue, El Cajon, CA 92020.