California enacted new regulations for the tenant screening process to maintain fairness between landlords and tenants. Updating California tenant screening laws has strengthened tenant protections. At the same time, they enable landlords to continue making profits from their investments.
The practical guide, by LeaseRunner, breaks down the main rules in recent updates. Especially, landlords must look at the requirements for landlords to accept portable tenant screening reports. This article also provides them with advice on how to handle tenant checks legally.
Overview of Tenant Screening Laws in California
As a California landlord, you have to deal with more than one set of rules. They include California rental application laws and background check rules. These policies work under federal, state, and local regulations. They shape a fair and efficient tenant screening process for landlords and tenants.
California Fair Housing Act
The California Fair Housing Act is a fundamental law that stops discrimination in housing and has a major impact on the tenant screening laws in California. It bans landlords from discriminating against tenants based on their race, color, or religion. The Act also covers gender, sexual orientation, marital status, and family status. This ensures a fair selection process for all applicants.
Fair Employment and Housing Act (FEHA)
The Fair Employment and Housing Act (FEHA) strengthens anti-discrimination in the state of California in broader sectors, including housing and employment. This Act affects what landlords can ask from applicants during a tenant background check in California. It ensures they don't misuse sensitive personal information, such as disability or marital status.
Unruh Act
The Unruh Civil Rights Act doubles down on tenant protections from landlords’ discrimination. Housing providers must give equal treatment to all rental applicants in all cases. These regulations reinforce the need for consistent California tenant screening laws and practices.
Fair Credit Reporting Act (FCRA)
The Fair Credit Reporting Act (FCRA) applies directly to any background check for renters in California. This Act controls how landlords use credit reports to evaluate applications. It also requires you to get an applicant's written consent before the tenant screening. You must provide a written “adverse action notice" to anyone you deny. Following the FCRA protects you from legal action.
California Civil Code §1950.6
California Civil Code §1950.6 sets rules for application fees. It directly impacts lease laws in California. This law limits how much a landlord can charge for a rental application. It also requires a detailed breakdown of the costs. They include tenant screening services, consumer credit reports, and the value of processing time landlords spend.
2025 Updates to California Tenant Screening Laws for Landlords
The 2025 laws added two major requirements that improve the tenant screening process in California.
Two Options for Processing Tenant Applications (AB 2493)
AB 2493 gives landlords two options when reviewing multiple applications. This is a significant change in California tenant screening laws.
- Option 1 - First-Come, First-Served Rule: Landlords must review applications in the order received. This prevents landlords from skipping applicants due to personal preference or discrimination. which helps create a fair process.
- Option 2 - Refunding Full Fees: It applies when landlords don’t take the first option. They must return the full tenant screening fees to all rejected applicants.
These new laws tighten the tenant screening process. They place more responsibilities on landlords to treat all applicants fairly. They also regulate how landlords use the applicants’ tenant screening fees properly.
Acceptance of Portable Tenant Screening Report (AB 2559)
AB 2559 requires all landlords to accept any valid Portable Tenant Screening Report (PTSR). This is different from other states, where accepting PTSRs is optional. Under this law, the applicants can share those reusable tenant screening reports with multiple landlords within 30 days.
The new change is one of the major improvements in California rental application laws. It enables the applicants to skip the repetitive tenant screening step. This saves them much time and money.
Allowable Tenant Screening Criteria in California
The landlords must follow strict requirements to rent a house in California. They restrict your request to some specific tenant screening reports from the applicants. Those reports include rental house background checks, such as income verification, credit reports, and background checks. These tenant screening services will help you choose a reliable renter.
Before you begin screening, you need to set clear screening criteria that comply with the tenant screening laws in California.
Written Screening Policy Requirements for Landlords
Having a written screening policy is a must for landlords. While not a direct legal requirement in California, it is your best defense against discrimination claims. This policy must clearly state your rental requirements. It should outline your standards for income, credit, and how you evaluate a criminal or eviction history.
This transparency protects you from claims of bias by showing you apply the same standards to all applicants. It also makes the application process more efficient for you and your applicants.
Criminal Background Checks
California law allows landlords to run criminal background checks as part of the tenant screening process. You can do this after the applicant gives you written consent. However, many cities enact their local ordinances to ensure a fair evaluation process. We’ll break down these laws further in the section below.
There are other cases of applicants who receive housing assistance from the Department of Housing and Urban Development (HUD). They are required to satisfy HUD’s criminal background check requirements. This process helps keep residents and communities safe.
Eviction History Checks
Landlords should check the eviction records of the applicants. This report will provide you with their previous experience in renting. As a result, an eviction check is a key part of any rental house background check. However, you must evaluate the applications on a case-by-case basis to ensure fairness. Meanwhile, you cannot use outdated or sealed evictions to reject the tenants.
Income Verification
The main purpose of tenant screening is to confirm if the applicants can afford the rent. Therefore, landlords must verify the tenant's income by looking at documents, such as pay stubs and bank statements.
Choosing a reliable income verification service provider is a very crucial step. Its screening results are solid grounds for you to make leasing decisions. You can use the online Income Verification and Cash Flow Reports from LeaseRunner. This digital platform provides you with the applicants’ accurate income reports instantly. The process is totally secure.
Credit Checks
Credit checks are also one of the most crucial tenant screening criteria. Landlords use these reports to assess an applicant's financial reliability. You can see a tenant’s debt and payment history through their score, late payments, and collection accounts. The credit report also shows a summary of their accounts, such as credit cards and loans.
Personal Reference Verification
Landlords often call past landlords or employers to check a tenant’s reliability. They should ask legal questions about the tenant's rental history or job. Good questions include asking about on-time rent payments, following the lease, and job stability.
It is vital to avoid questions that invade privacy or lead to discrimination. Do not ask about race, gender, religion, or other protected classes.
Local Ordinances in California Tenant Screening Process
Some California cities impose stricter rules on criminal history checks:
- San Francisco: San Francisco has a Fair Chance Ordinance (Police Code Section 49). Under this law, landlords can't use arrest records or most convictions against an applicant.
- Los Angeles: Strong limits on rejecting applicants based on criminal history.
- Oakland and Berkeley: Ban landlords from asking about most criminal backgrounds.
- Richmond: Has specific “Ban the Box" housing policies under its Fair Chance Housing Ordinance (Municipal Code Section 6.22).
If you own property in those cities, you must check local and county rules. Follow California tenant screening laws and local ordinances to avoid legal consequences.
How Much Landlords Can Charge Tenant Screening Fees
California law sets a cap on the tenant screening fee. Landlords cannot charge more than the legal limit for a background check for an apartment or a house. This rule helps tenants budget for their move. It also ensures landlords remain compliant during the screening process.
Application Tenant Screening Fee Limits
California Civil Code §1950.6 sets rules for the maximum fee landlords can charge. This fee changes yearly with the Consumer Price Index (CPI). For 2025, the cap is about $64.50 for each applicant. You must update the annual limit.
Requirements of Providing Consumer Credit Reports
If an applicant pays a screening fee, they have a legal right to a copy of their consumer credit report. This is an additional guideline for landlords introduced in 2025. It gives tenants more rights to check how the landlords conduct the credit check. They can find any errors in the reports and fix them. The new rule is also a win for landlords. It lowers the chance of legal disputes over screening decisions.
Itemized Receipt Requirements
You must give the applicant a receipt that lists all costs. This document must show exactly how the screening fee was spent. Being transparent and clear about these charges helps avoid disputes with tenants.
Refund Rules for Unused Screening Fees and Non-selected Applications
A new 2025 law, AB 2493, says you must refund the entire fee to applicants you do not select for the rental. As a main part of California’s strict tenant screening laws, this regulation aims to protect tenants and promote fairness in the rental market.
Applicants often pay many fees without knowing if they are used appropriately. These tenant screening policies make the system fairer and more transparent for everyone.
Rules on Security Deposit Documentation (AB 2801)
California also updated its rental laws and security deposit rules. For most properties, the maximum security deposit is limited to one month's rent (as of July 1, 2024, per AB 12). Only small landlords meeting specific criteria can charge up to two months' rent.
AB 2801 (effective April 2025) requires much more documentation for any deductions from the deposit. This includes providing move-in, move-out, and post-repair photos, and detailed itemized statements. These lease laws in California mean you must be highly accurate with your records.
A Practical Guide to the California Tenant Screening Process
You should have a clear, written plan for screening tenants. It helps you comply with California tenant screening laws. Check out this 5-step guide to a legal tenant screening process.
Step 1: Collect Applications and Screening Fees
Use a digital rental verification form that complies with updated laws. Be clear on income requirements and screening fees before charging.
Step 2: Process Applications
You must choose and follow one of the two options set by the new AB 2493. This is the first-come, first-served method, or the full refund policy.
Step 3: Run a California Tenant Screening Report
Before running a report, you must get consent from applicants. Landlords must also accept a Portable Tenant Screening Report if provided. If the applicant submits a valid PTSR in California, you cannot charge a separate screening fee. This rule helps the applicants cut their screening costs and avoid paying for the same report multiple times.
Step 4: Evaluate Applications & Make the Final Decision
Assess income, credit, rental history, and reference reports. There is one step you shouldn’t miss. At the initial stage of income verification, you have to check whether the tenants’ monthly salaries meet your income requirements. For example, you can apply the 3 times the rent rule to confirm if they can pay rent on time consistently.
But before doing all these things, you should set an affordable rent. You can determine how much rent you should charge based on the market rates and your competitors’ rental prices. Setting a suitable price for your tenant base can reduce vacancy periods and maintain steady income.
Step 5: Issue Written Approval or Adverse Action Notice
If you reject the application based on the screening report, you must send a written Adverse Action Notice. It must include the name and contact information of the consumer reporting agency. It must also tell the applicant their right to dispute the information and get a free copy of the report.
Tenant Rights During the Tenant Screening Process
Applicants have key rights throughout the process. These rights ensure fairness and access to accurate information. Landlords must respect these rights to comply with California tenant screening laws.
Tenant Privacy Rights & Access to Screening Report
Applicants have a right to privacy regarding their data. Once they authorize a rental house background check, they are entitled to receive a copy of that report. This right is guaranteed under the FCRA. Tenants can use this to check their tenant screening report for any errors or incorrect information.
Appealing a Landlord’s Adverse Action Notice
If an application is denied due to an inaccurate screening report, the applicant can appeal to the Consumer Reporting Agency (CRA). The CRA must then investigate the claim quickly. While the investigation is ongoing, a landlord cannot reuse the disputed information as the sole reason for denial.
Fair housing laws require landlords to consider all relevant information. This reinforces the non-discriminatory nature of California tenant screening laws.
Best Practices for California Landlords to Stay Compliant
A key part of being a good landlord is using a professional tenant screening service. This makes the screening process easy and legal. This helps you follow California tenant screening laws and avoid legal trouble.
Comply with Fair Housing Laws
Make sure your screening standards do not unintentionally discriminate. You must apply the same standards to all applicants. Be aware of the many protected classes defined by FEHA and state laws.
Publish a Clear Written Screening Policy
A clear policy is your foundation. Publish a written policy that details all your rental requirements in California. Include your standards for income, credit, and how you evaluate criminal and eviction history. This shows transparency to applicants and compliance with legal authorities.
Obtain Proper Consent from Applicants
In California, landlords must get written consent from an applicant. This is a must before they run any tenant background check. This rule protects the applicant's privacy. Skipping this step is a direct violation of the FCRA.
Choose Reliable Tenant Screening Services in California
Finding a tenant screening service in California is not difficult. However, the real challenge is finding a reliable provider that designs its system to comply with all the complex state and local laws. This is where LeaseRunner comes in. As an online platform, it offers all-inclusive services that are fast, economical, and completely secure.
Partnering with a reliable company like LeaseRunner is crucial to getting the accurate reports you need to make smart decisions. Our tenant background screening service provides fast, accurate reports that meet all California background check rules.
Protect Applicant Records
You must keep all applicant records, reports, and background checks safe. When you choose a reliable tenant screening provider, your applicant data is always secure. This is because the provider handles the technical parts of data protection.
Your main job is to comply with what you can and cannot do under California lease laws. This ensures all records are managed properly.
Consult Legal Professionals
Navigating California tenant screening laws is very hard. The rules change often, and local city laws also apply. You should talk to a lawyer to make sure your screening is legal. This will help you follow all the newest state and local rules. It is also smart to contact a lawyer if a dispute with a tenant becomes tense. A legal professional can advise you and help you resolve the issue.
Staying updated on laws like those governing what is a notice period by consulting attorneys and California-specific rental rules is always a good idea.
Bottom Line
Staying on top of California tenant screening laws is more than just following rules. It makes your business safer and more efficient. The changes in 2025 address the need for clear policies and fair practices. This helps you find better tenants. It saves you from costly legal issues.
By using our tenant screening services in California, you can simplify the process and ensure compliance. We provide the tools you need to perform a full tenant background check in California. This includes checking eviction history and verifying income.
FAQ
Q1: What background checks can landlords run in California?
Landlords can run credit, criminal, and eviction history checks, but criminal records’ use varies by city. Income and personal references are also standard.
Q2: What are the rent control laws in California?
Rent control varies by city; many limit rent increases annually. Screening practices must still comply with state laws.
Q3: How much is a background check for an apartment in California?
Landlords can charge up to about $63 in 2025 for tenant screening fees, including credit and eviction checks.
Q4: How does the Portable Tenant Screening Report work in California?
A Portable Tenant Screening Report (PTSR) lets renters reuse a single background and credit report for many rental applications. California law now requires landlords to accept these reports. This helps renters avoid paying a new screening fee for each place. It also saves landlords time because they can review the existing report instead of ordering a new one.
