SUGGR Network Pledge to
End Rental Housing Inequity
Eliminating the use of prejudicial and biased instruments in the home rental marketplace
MMI is co-founder of the SUGGR (Socioeconomic Underground Railroad - pronounced "sugar") Network, a small, but growing movement that includes efforts to reform the rental housing market. Together, we stand in solidarity with victims of credit score and background check discrimination and exploitation.
Specifically, we and others are calling for the end of the use of instruments like credit scores and background checks when determining who is eligible for all core products and services, from employment, housing and utilities (including cell phones/internet) to banking access and legally mandated insurances.
The Call
The City of Portland, Oregon has passed what might be the nation's first truly restorative rental housing statute. Fair Access in Renting (FAIR) is a groundbreaking screening criteria and security deposit reform policy package that effectively removes discriminatory barriers and increases access to housing.
FAIR changes the criteria that can be used to screen potential tenants and regulate the security deposit process.
Since going into effect in 2020, an increasing number of property owners are foregoing discriminatory application fees and credit checks, which is making housing more accessible to everyone.
We call on other cities to follow Portland's example.
The Problem
The FICO score, despite its reach into every aspect of our economic lives, is a for-profit financial instrument created by for-profit companies, making them some of the most profitable companies in the world. Yet, like Google, Amazon and Wal-Mart, their only true obligation is to their shareholders, not the public.
Increasingly, we’re recognizing how background checks are inherent biased and discriminatory. For example, extensive research confirms how African Americans are commonly charged with a felony, whereas Caucasians are charged with misdemeanors for the same crime, in similar circumstances. As a result, the former, on every application for the rest of their lives, will be required to check the box that indicates they’ve been convicted of a felony. As such, we’re realizing how its use as a screening mechanism further harms people we’ve already disadvantaged.
But credit scores are even worse. Not only do they share background checks’ inherent biases, the information itself, which doesn’t come from government sources, but rather, from other for profit companies, is even less credible. Any company, with no proof, can add a negative entry to one’s credit report (or, if they value your business, forego doing so), and since there are no penalties for submitting erroneous information, companies have no incentive to get it right.
Then there’s how it’s weaponized. The City of Seattle, in one of many such studies, found that more than half of all of tested properties showed evidence of extensive housing discrimination based on racial identity and disability status. The Office used paired testers with identical rental profiles in every respect except racial identity or disability. They found nearly 70% of property managers penalized African American candidates by quoting them higher rents and charging them for credit reports, while doing neither for Caucasian applicants, and 36% discriminated against candidates with disabilities.
And that’s before you get to the adverse impact of the fees associated with running these reports. A 2020 Zillow study found that ethnic minority applicants are disproportionately charged such fees, even when researchers controlled for age, income and other factors. In many rental markets, ethnic minority applicants submit, on average, must submit three times as many applications, and pay accompanying fees, as Euro American applicants, in order to successfully land an apartment. Simply to be considered, these applicants are required to fork over application fees, essentially, a $50 lottery ticket, with no obligation whatsoever required from the property owner.
The Pledge
Together, we can do better, which is why those of us who are fortunate enough to be on the plus side of this kind of inequity are committing to use our economic influence to push for fairer policies. At MMI, we’re supporting this effort in two major ways:
Organizationally, our Housing Assistance Fund will help with everything from deposits to the launching of Rainy Day Rent, a housing stability safety net. And through our Level UP Tech joint initiative, we’re building a suite of services that will make all facets of the rental housing process easier for property owners and, at the same time, fairer for rental customers.
Individually, we’re asking everyone who believes in fairness to pledge to help eliminate discrimination and exploitation from the home rentalship process. Specifically, we’re calling on property owners/agents to stop charging application fees altogether or using proxies of discrimination to screen home rental customers. Other ways property owners can make the process fairer for everyone include:
Likewise, we’re calling on home rental customers, especially those with high credit scores, clean background checks, and ample financial resources, to become Housing Equity Allies; standing in solidarity with those being discriminated against, by offering alternatives – everything from providing references to making advance payments – in lieu of submitting to credit and background checks.
Conclusion
Together, we can create systems that are fair to everyone, ones that protect both property owners and rental customers, and that, above all, infuse greater human regard into the process. More information about our efforts to end poverty can be found at the Red Mountain Foundry.
- Back to SUGGR Network -
End Rental Housing Inequity
Eliminating the use of prejudicial and biased instruments in the home rental marketplace
MMI is co-founder of the SUGGR (Socioeconomic Underground Railroad - pronounced "sugar") Network, a small, but growing movement that includes efforts to reform the rental housing market. Together, we stand in solidarity with victims of credit score and background check discrimination and exploitation.
Specifically, we and others are calling for the end of the use of instruments like credit scores and background checks when determining who is eligible for all core products and services, from employment, housing and utilities (including cell phones/internet) to banking access and legally mandated insurances.
The Call
The City of Portland, Oregon has passed what might be the nation's first truly restorative rental housing statute. Fair Access in Renting (FAIR) is a groundbreaking screening criteria and security deposit reform policy package that effectively removes discriminatory barriers and increases access to housing.
FAIR changes the criteria that can be used to screen potential tenants and regulate the security deposit process.
Since going into effect in 2020, an increasing number of property owners are foregoing discriminatory application fees and credit checks, which is making housing more accessible to everyone.
We call on other cities to follow Portland's example.
The Problem
The FICO score, despite its reach into every aspect of our economic lives, is a for-profit financial instrument created by for-profit companies, making them some of the most profitable companies in the world. Yet, like Google, Amazon and Wal-Mart, their only true obligation is to their shareholders, not the public.
Increasingly, we’re recognizing how background checks are inherent biased and discriminatory. For example, extensive research confirms how African Americans are commonly charged with a felony, whereas Caucasians are charged with misdemeanors for the same crime, in similar circumstances. As a result, the former, on every application for the rest of their lives, will be required to check the box that indicates they’ve been convicted of a felony. As such, we’re realizing how its use as a screening mechanism further harms people we’ve already disadvantaged.
But credit scores are even worse. Not only do they share background checks’ inherent biases, the information itself, which doesn’t come from government sources, but rather, from other for profit companies, is even less credible. Any company, with no proof, can add a negative entry to one’s credit report (or, if they value your business, forego doing so), and since there are no penalties for submitting erroneous information, companies have no incentive to get it right.
Then there’s how it’s weaponized. The City of Seattle, in one of many such studies, found that more than half of all of tested properties showed evidence of extensive housing discrimination based on racial identity and disability status. The Office used paired testers with identical rental profiles in every respect except racial identity or disability. They found nearly 70% of property managers penalized African American candidates by quoting them higher rents and charging them for credit reports, while doing neither for Caucasian applicants, and 36% discriminated against candidates with disabilities.
And that’s before you get to the adverse impact of the fees associated with running these reports. A 2020 Zillow study found that ethnic minority applicants are disproportionately charged such fees, even when researchers controlled for age, income and other factors. In many rental markets, ethnic minority applicants submit, on average, must submit three times as many applications, and pay accompanying fees, as Euro American applicants, in order to successfully land an apartment. Simply to be considered, these applicants are required to fork over application fees, essentially, a $50 lottery ticket, with no obligation whatsoever required from the property owner.
The Pledge
Together, we can do better, which is why those of us who are fortunate enough to be on the plus side of this kind of inequity are committing to use our economic influence to push for fairer policies. At MMI, we’re supporting this effort in two major ways:
Organizationally, our Housing Assistance Fund will help with everything from deposits to the launching of Rainy Day Rent, a housing stability safety net. And through our Level UP Tech joint initiative, we’re building a suite of services that will make all facets of the rental housing process easier for property owners and, at the same time, fairer for rental customers.
Individually, we’re asking everyone who believes in fairness to pledge to help eliminate discrimination and exploitation from the home rentalship process. Specifically, we’re calling on property owners/agents to stop charging application fees altogether or using proxies of discrimination to screen home rental customers. Other ways property owners can make the process fairer for everyone include:
- Moving to a “Pay to Stay” model, similar to what hotels, vacation rentals and Airbnb bookings use, and which have all but eliminated discrimination from the process. Two months’ advanced payment, a card on file authorized for future payments, and an appropriate security deposit should be sufficient to mitigate risk.
- Given the degree to which racism distorts the information found on a legal background check, references are a much fairer and more reliable indicator of how a person will treat the property.
- Clean up our language. Shift from “tenants” and “landlords” (a holdover from sharecropping days) to “home rental customers” and “property owners/agents”, or other language that recognizes this as an economic transaction, a fair exchange of funds for goods and services.
- If you’re in a situation that legally requires that you run credit or background checks, set a policy where your company covers the fees, rather than charging those fees to potential customers.
- Limit standard leases to no more than 6 months before reverting to month-to-month status. This will allow people suffering financial hardship to transition smoothly, which reduces everything from tying the property up in eviction proceedings to court fees.
- Spread the word. State clearly in your home rental listings that you’re committed to fairness. This will attract potential customers who share your values, help you stand out from other property owners and help make these practices more commonplace.
Likewise, we’re calling on home rental customers, especially those with high credit scores, clean background checks, and ample financial resources, to become Housing Equity Allies; standing in solidarity with those being discriminated against, by offering alternatives – everything from providing references to making advance payments – in lieu of submitting to credit and background checks.
Conclusion
Together, we can create systems that are fair to everyone, ones that protect both property owners and rental customers, and that, above all, infuse greater human regard into the process. More information about our efforts to end poverty can be found at the Red Mountain Foundry.
- Back to SUGGR Network -