GREENBROOK — Requiring both background and credit checks on renters is a fairly common requirement imposed on homeowners by condominium associations.
The practice is legal when delineated in the association’s documents and implemented impartially. But is it fair?
Lakewood Ranch resident Leo Mascitto doesn’t think so and maintains the policy infringes on his rights as a property owner and profiles people based on credit. In Greenbrook Walk, where Mascitto owns a 1,600-square-foot unit, the association requires complete criminal background and credit checks, plus a non-refundable $100 application fee for both prospective homeowners and renters alike.
The policy, Mascitto said, has made it difficult for him to find a renter. Since October, Mascitto has had about a dozen individuals interested in the property, some of whom could provide first- and last-month rent plus a deposit. However, because the prospective tenants had a foreclosure or lost a business, the association would not approve the application.
To date, Mascitto’s condo remains vacant.
“The last time I checked, my credit score was 817,” Mascitto said. “If I go into foreclosure, does that make me a bad person?”
A current application for buying or renting a unit in Greenbrook Walk states the “credit report shall not contain evidence of any bankruptcy, notices of court judgments, persistent collection agency activity, writing of bad checks or more than 10% of all credit accounts with bad payment history.” Any foreclosure or bankruptcy actions must have happened at least three years ago and the applicant must have restored good credit.
Mascitto was told applicants must have “impeccable credit” or their application would be denied.
The association’s property management company, C&S Condominium Management Services, declined comment.
Mascitto plans to take the issue before his HOA board in March in hopes it will consider eliminating the credit check or at least to consider lifting the restriction temporarily as a way to help property owners who are paying association dues but are having trouble keeping up with the bills without renters.
Original association documents only required the property owner provide a copy of the lease to the association.
“I think the background check is very important, but in today’s economy, who has perfect credit?” he said. “The bottom line is it’s very hard to find someone (a renter) with good credit, and that’s where I stand right now.”
But for Mascitto, is also a matter of principal. He said the policy is a way for associations to profile people based on their credit, which he maintains should be illegal.
For example, someone may have had nearly perfect credit until losing his job in the economic downturn and consequently losing his home. Even if a relative offered to buy that person a unit in cash, he would not be able to purchase it, according to association requirements. Mascitto wouldn’t even be able to let a relative stay at his place for free if the relative had fallen on hard times and lost his home.
But if a homeowner in Greenbrook Walk lost his job and fell behind on his bills, he’d have tainted credit, too.
“Then what has (the credit report) proven?” Mascitto asked.
Plus, Mascitto is responsible for paying association dues — not the renter. If the renter doesn’t pay him, it’s still his responsibility to make sure the mortgage and other bills are current.
Mascitto could rent his unit without the association’s knowledge, but an illegal tenant could be evicted by the association if he or she were discovered.
And even during the Greenbrook Walk Condominium Association Board Meeting Feb. 17, Board President Allison Cohen indicated two property owners who have been failing to pay dues may have illegal renters in their units.
Cohen and board member Kristi Hamilton declined comment further for this article.
Contact Pam Eubanks at [email protected].
Local attorney Mary Hawk, who specializes in community association law for Porges, Hamlin, Knowles & Prouty, said the practice of requiring credit checks is fairly common and is legal if allowed by an association’s documents.
“It’s not out of the norm,” Hawk said, noting some associations simply ask for a copy of a lease while others even require interviews with prospective tenants. “As long as documents allow them to do it, and they are doing it using the same criteria for everyone, it’s allowable.”