Real Estate Record-Keeping for Colorado Landlords
(Part I)

Filed Under (Leases and Landlord Tenant) on 12-05-2011

Rental tax deductions, financial records, rent ledger, rental ledger, rental criteria, property management records

By Victor M. Grimm, Esq. and Rachel Brand

Owning a rental property is like running a business.  Keeping accurate records is key to measuring return on investment. It’s also crucial as a means to keep track of repairs and to defend against discrimination claims. Here is the first of four types of records landlords need to keep: a record of showing and leasing an individual property.

Federal, state, and local laws bar discrimination

When it’s time to find a tenant, savvy landlords know to show and rent their properties fairly and without discrimination. This is because federal, state, and local laws prohibit certain discriminatory acts in the leasing process. For instance, the Federal Fair Housing Act prohibits discrimination against tenants on the basis of race or color, national origin, religion, sex, family status, and disability.   This means you can’t advertise your property as “great for families” or decide you only want to rent to married couples.

What’s more, Colorado law prohibits discrimination against potential tenants on the basis of ancestry, creed, or marital status.  And local city and county ordinances may grant additional protections to potential tenants. For example the City of Boulder also prohibits discrimination based on: “race, creed, color, sex, sexual orientation, gender variance, genetic characteristics, marital status, religion, national origin, ancestry, pregnancy, parenthood, custody of a minor child, or mental or physical disability of the individual or such individual’s friends or associates. . . .”

But landlords can use objective, non-discriminatory tenant criteria

At the same time, landlords are allowed to develop some criteria for tenants. In other words, landlords can be selective based on objective non-discriminatory criteria.  In selecting tenants, you can consider their bankruptcy history and FICO scores, criminal history, job history, and/or income. 

The problem is, how do you prove you’re not discriminating against tenants while still maintaining some rental criteria?

Important records to keep

One possible approach is to write down your rental criteria before you list the property for rent. You could keep these criteria in a document in your computer and files. Then, once the property is listed, keep scrupulous records of:

•    who contacted you;
•    when they contacted you (in chronological order);
•    when you called potential renters back;
•    when a potential renter saw the property;
•    who filled out a rental application and when;
•    the results of any rental screening report;
•    and, if someone was rejected, why the tenant did not meet your rental criteria.

Keeping such records will allow you to prove that you are, indeed, not discriminating.  In the next post of this series, learn about three other kinds of records that are important to keep.

For more information, see the Landlord & Tenant Guide to Colorado Leases and Evictions, 5th Edition, by Victor M. Grimm, Esq. and Denise E. Grimm.