Avoid 9 Discrimination Pitfalls When Tenants Seek Unit Transfers

While it may seem like routine business, responding to transfer requests may have significant fair housing implications.

 

Let’s play a quick game of fair housing word association in the multifamily leasing context:

Housing discrimination.

For many, this phrase summons up images of landowners seeking to avoid leasing their property to persons of particular races, nationalities, or other protected characteristics. And that, in a sense, is rental housing discrimination in its traditional form.

However, housing discrimination is equally likely to occur after a lease is signed and a landlord-tenant relationship is formed. Thus, current tenants (or groups representing their interests) account for almost half of the tens of thousands of new federal fair housing complaints filed against landlords in the United States each year.

Bottom Line: Ensuring nondiscriminatory treatment of your existing tenants is, or at least should be, an integral part of your fair housing compliance efforts.

This month’s lesson deals with a significant but frequently overlooked aspect of tenant relations and a potential source of discrimination complaints: handling requests for transfers to a different apartment in the same building or community. While it may seem like routine rental business, responding to transfer requests may have significant fair housing implications. Common examples:

• A couple expecting a new baby needs to move to a larger apartment;
• A tenant develops a mobility impairment and can no longer climb the stairs to his third-floor unit; or
• A domestic violence victim needs to get away from her violent and abusive boyfriend.

Accordingly, this month’s lesson is all about ensuring that you and your leasing and management staff recognize and take the appropriate steps to manage discrimination risks when processing tenants’ transfer requests. First, we’ll explain how fair housing laws affect transfers. Then, we’ll list the nine pitfalls and what you must do to avoid them. We’ll finish up the lesson with the Coach’s Quiz to test how well you learned the material.   

WHAT DOES THE LAW SAY?

The federal Fair Housing Act (FHA) bans discrimination on the basis of race, color, religion, sex, handicap (disability), familial status, or national origin (which we’ll refer to collectively as “protected characteristics”). Discrimination is defined broadly to include, among other things:

• Refusing to rent, negotiate for, or otherwise make housing available;
• Setting different terms, conditions, or privileges for rental;
• Imposing different charges or prices for renting a dwelling;  
• Limiting privileges, services, or facilities of a dwelling;
• Assigning a person to a particular building or section of a building (a practice known as “steering”); and
• Refusing to make reasonable accommodations necessary for a person with disabilities to have an equal opportunity to use and enjoy a dwelling.

While refusing to make accommodations is the most common example, not allowing tenants to transfer to a different apartment may be a form of any one or more of these prohibited actions to the extent that the decision is based on protected characteristics.

Other Laws that May Come into Play

The FHA is just one of several laws that landlords need to navigate when dealing with transfers.

ADA: If you open all or part of your community to the public, you must make “reasonable modifications” and ensure it’s designed, constructed, and maintained to be fully accessible to people with disabilities under federal Americans with Disabilities Act (ADA) requirements.

Federal Housing Assistance Rules: Landlords that participate in Section 8 and other HUD housing and federal assistance programs are subject to stricter housing discrimination rules under Section 504 of the federal Rehabilitation Act of 1973.

VAWA: In 1994, the federal government adopted the Violence Against Women Act (VAWA) banning discrimination against victims of domestic violence, dating violence, sexual assault, or stalking (which we’ll refer to collectively as “domestic violence victims”). VAWA originally applied to public housing and Section 8 voucher and project-based programs, but in 2013, Congress expanded it to cover Low Income Housing Tax Credit properties and other HUD programs. It doesn’t apply to private, conventional housing. Among other things, the law requires landlords to honor protective orders and grant emergency transfers to domestic violence victims when needed for their physical protection.  

State and Local Fair Housing Laws: Legislatures in many states and municipalities feel that the FHA doesn’t go far enough and have adopted their own fair housing laws extending protection to groups and protected characteristics that the federal law doesn’t expressly list, including:

• Age;
• Ancestry;
• Marital status;
• Sexual orientation;
• Gender identity or expression;
• Source of income;
• Status as a victim of domestic violence;
• Criminal record;
• Political belief;
• Creed; and/or
• Military or veteran status.

9 TRANSFER LIABILITY PITFALLS TO AVOID

There are nine questionable practices to beware of when fielding tenants’ requests for transfer to a new apartment.

Pitfall #1: Blanket Ban on All Transfers

Landlords don’t have to allow anybody to transfer to any apartment for any reason as long as they apply the no-transfer rule consistently to all tenants without regard to protected characteristics.

Right?

Wrong.

Explanation: Policies that appear neutral on their face may still discriminate if they have an adverse impact on protected groups. Such may be the case with a blanket no-transfer policy. Even if universally applied, automatically barring transfers could have the effect of:  

• Forcing families with soon to be born or adopted young children to move out of the community; and/or
• Violating a disabled tenant’s right to reasonable accommodations, for example, by preventing a mobility-impaired tenant from transferring to a ground-floor unit or a tenant with a severe respiratory illness from transferring to an apartment in the no-smoking section of the building.

Pitfall #2: Flatly Rejecting Accommodations Transfers

Suppose you have no available apartments suitable for a tenant’s disability, such as a ground-floor unit for a wheelchair-bound tenant. In this situation, the only way you could grant the transfer request is by forcing the tenant currently occupying the desired unit out via eviction or compelled transfer. However, HUD guidelines make it clear that you don’t have to evict one tenant to accommodate another.

But there’s more to the issue than that. The point of the accommodations rule is to require landlords to engage the tenant to determine and explore ways to accommodate his or her needs and capabilities. Thus, a flat “no” won’t do.

Example: A Missouri landlord had to shell out $44,000 for denying a tenant’s request to transfer to a unit with fewer stairs to accommodate her mobility-impaired daughter. The landlord flatly refused the request, saying it had no apartments available. In dishing out the fine, the federal court cited the landlord’s failure to even engage the tenant, evaluate the daughter’s medical needs, and explore ways to accommodate them [United States v. Dunnwood, (E.D. Mo.) July 16, 2020]. 

Takeaway: The accommodations process shouldn’t end simply because there are no suitable units available for a transfer. Before you reject the request, dig deeper and ask yourself this question: Is there some other change you can make or action you can take that would enable the requestor to more fully use and enjoy his or her home? For example, if there’s no available apartment on a no-smoking floor to which you can relocate a tenant with a respiratory ailment, maybe you can install a special ventilation system in her current unit instead. And while you don’t have to evict any current tenants, you might at least consider the possibility that somebody on a no-smoking floor might be willing to voluntarily swap units with the requestor.  

Pitfall #3: Rejecting Accommodations Transfers on Technical Procedural Grounds

HUD recommends that landlords create forms and procedures that people can use to submit written requests for accommodations, including transfers. This can clarify, facilitate, and speed up the processing of requests and “prevent misunderstandings regarding what’s being requested, or whether the request was made,” according to HUD/US Department of Justice (DOJ) Guidelines (which we’ll refer to as the “Guidelines”). In cases not involving accommodations, failure to follow transfer rules and procedures might be grounds for rejecting tenants’ transfer requests.   

Example: A Texas landlord evicted a Black tenant for moving into a neighboring apartment in the same building with a family to which he’s unrelated without permission. The tenant sued for racial discrimination. The landlord denied the charge and claimed it evicted him for not following the required procedure to get permission to move to another unit. The Texas federal court ruled that the landlord’s enforcement of its transfer policy was a legitimate and nondiscriminatory reason to evict and that there was no evidence that race factored into the decision [Mandawala v. Struga Mgmt., 2021 U.S. Dist. LEXIS 131736, 2021 WL 2981196].

However, being a stickler for transfer procedures can get you into fair housing trouble when a tenant seeks the transfer as an accommodation for a disability. That’s because you can’t make a big deal over the timing and formalities of accommodations requests. There’s no rule saying that such requests must be in writing. Nor are requestors required to use the words “reasonable accommodation,” “fair housing,” “disability,” or any other magic language. All they need to do is make it clear that they’re requesting a transfer as an accommodation.

In addition, you can ask requestors to put their requests in writing, but you can’t require them to do so. Landlords “must give appropriate consideration to reasonable accommodation requests even if the requester makes the request orally or does not use the [landlord’s] preferred forms or procedures for making such requests,” the Guidelines explain.

Note also that accommodation transfer requests can come from either tenants with disabilities or persons acting on their behalf. According to the Guidelines, a landlord is on notice “that a reasonable accommodation request has been made if a person, her family member, or someone acting on her behalf requests a change, exception, or adjustment to a rule, policy, practice, or service because of a disability.”

Pitfall #4: Improperly Verifying a Disabled Tenant’s Need for Transfer

Normally, it’s against the rules to ask tenants if they’re disabled or about the nature and extent of their disability. However, the Guidelines give landlords leeway to gather information about a person’s disability in response to a reasonable accommodation request to the extent the information is necessary to determine three things:

1. The person meets the FHA definition of disability—that is, has a physical or mental impairment that substantially limits one or more major life activities;
2. Exactly what accommodation the tenant is requesting; and
3. Whether there’s a “nexus” or relationship between the disability and the need for the requested accommodation. 

Caveat: There are limits on what information you can and can’t ask for, depending on what you already know or can easily surmise.

Rule 1: If the person’s disability and need for the accommodation is obvious, or otherwise known to you, you can’t request any additional information about the disability or disability-related need for the accommodation.

Rule 2: If the disability is known or readily apparent to the landlord, but the need for the accommodation is not, you may request only information that’s necessary to evaluate the disability-related need for the accommodation.

• OK to Request Verification of Disability: A tenant in a building without elevator service wants to transfer to a ground-floor apartment, claiming she can’t climb steps due to asthma or another respiratory ailment. Since the claimed disability isn’t readily apparent, the landlord would be justified in asking for verification of the ailment and why she needs a ground-floor apartment to accommodate it.
• Not OK to Request Verification of Disability: Same scenario but instead of a respiratory ailment, the tenant seeking a transfer uses a wheelchair. Since the physical disability (a mobility impairment) and disability-related need for the requested accommodation are both readily apparent, the landlord can’t require the tenant to provide any additional information about the disability or need for a ground-floor apartment.

Coach’s Tip: You may be able to get the information you need to verify that the person meets the FHA definition of disability directly from the requestors themselves—for example, in the form of credible statements from the individuals, or the fact they have government-issued disability license plates or placards on their vehicle or receive Supplemental Security Income or Social Security Disability Insurance benefits despite being under age 65. If necessary, the Guidelines say landlords may also seek verification from a doctor or other medical professional, peer support group, non-medical service agency, or reliable third party in a position to know about the individual’s disability. However, they must limit the request to only the information needed to verify the disability and need for the accommodation. 

Pitfall #5: Charging Fees or Deposits for Accommodations Transfers

It’s neither unusual nor illegal for landlords to charge tenants fees to defray the costs of processing transfer requests. Upon approving the request, landlords might also ask tenants to pay a relocation fee and/or deposit to cover moving costs. While this may be 100 percent legitimate in just about all other circumstances, it becomes problematic when tenants seek a transfer as a reasonable accommodation for a disability.

Explanation: The Guidelines state that you can’t make individuals with disabilities pay extra fees or deposits as a condition for receiving a requested accommodation. That includes charging an administrative fee for processing an accommodations request. If an accommodation is reasonable, you must pay the associated costs out of your own pocket and not charge the requestor a fee or deposit to defray the associated expenses. Similarly, if an accommodation is reasonable, you must provide it without imposing financial or other conditions, such as by requiring tenants to pay “pet deposits” or carry extra insurance coverage for their service animals.

Example: A Minnesota apartment community paid $35,000 to settle claims of placing undue conditions on a tenant’s request for a service animal by requiring her to:

• Buy an insurance policy covering the dog and listing the landlord as a co-insured;
• Make the dog wear a special emotional support animal vest at all times outside the apartment; and
• Sign an “indemnification and hold harmless waiver” covering the landlord against any harm the dog caused [United States v. Brooklyn Park 73rd Leased Housing Assoc., LLC, (D. Minn., Jan. 22, 2016)].

Pitfall #6: Using Transfers to Discriminate Against Families with Children

It’s not just persons with disabilities; how you handle transfers also has fair housing implications for tenants with children. Explanation: The ban on familial status discrimination applies not only to families with children under 18, but also to pregnant women and others who have or are in the process of adopting or obtaining custody of a child. In the transfers context, liability risks are thus most likely to arise when existing tenants have a new baby, adopt, or let a child move in with them.

One common pitfall is forcing tenants facing these circumstances to transfer to a larger apartment, particularly when the added child won’t cause the tenant to exceed the state or local occupancy limit that applies to their current unit.

Example: The property manager of a South Dakota community with a two-person-per-bedroom occupancy policy told a couple that they’d have to transfer from their one-bedroom apartment to a two-bedroom unit after their new baby arrived. The manager claimed that the two-per-bedroom rule was required by city code, but HUD read the code as allowing additional occupants to sleep in the non-bedroom areas and, in 2018, charged the manager and owners with family status discrimination.  

Another variation on this theme would be to deny the transfer request of a family that wants to transfer to a larger apartment for their added children as a way to force them to move out of the community—for example, where a landlord determined to keep young children out of the building seizes on the couple’s need for extra space as an excuse and opportunity to get rid of them.

Pitfall #7: Using Transfers as a “Steering” Mechanism

Steering is a form of discrimination that occurs when a landlord tries to influence a tenant’s (or rental prospect’s) choice in housing based on the person’s protected characteristics. Steering is illegal because it limits tenants’ choices and denies them the opportunity to rent the housing they choose. Practiced on a wider basis, steering also perpetuates segregation across apartment communities, neighborhoods, towns, cities, and wider communities. And while steering may be overt and malicious—for example, where a landlord deliberately tries to exclude or relegate people of certain protected characteristics to specific floors or parts of a building—it can also be subtle and inadvertent.

One of the most common forms of steering is seeking to influence tenants’ choices based on where they’d be most comfortable. The critical assumption that’s dangerous to make and even more poisonous to act upon is that people are more “comfortable” and “compatible” with people of their own race, color, etc. Accordingly, telling tenants who want to transfer that they’d be uncomfortable in the desired unit or more comfortable in their current unit suggests that you’re trying to influence them on the basis of their protected characteristics. This constitutes illegal steering even when rental and managing agents genuinely believe they’re acting in the tenants’ best interests.

While it may implicate any protected characteristic, this form of subtle steering in which landlords second guess and seek to influence tenants’ transfer choices is especially apt to arise when tenants want to relocate to units that the landlord or its agents deem unsuitable for children, such as those located on an upper floor or right next to a community pool that doesn’t have a lifeguard.

A 1992 in-house legal memorandum from HUD’s Fair Housing Division states that denying or trying to discourage families with children housing on the basis of safety is illegal steering. According to the memo, the FHA requires “housing providers to make all units, including units on upper floors and units with balconies, available to families with children.” It also bans the practice of making families with children sign waivers of liability not required of other residents. However, the HUD memo does allow for making “factual statements about perceived hazards of their property,” as long as:

• The statements are “truthful and not misleading”;
• The statements don’t indicate a “preference, limitation, or discrimination” based on familial status; and
• An “ordinary listener” wouldn’t interpret the statements as discouraging families with children from deciding to live in the apartment.

Pitfall #8: Denying Emergency Transfers to Domestic Violence Victims

Although the FHA doesn’t list it as a protected characteristic, HUD and the courts take the position that excluding people because they’re domestic violence victims is a form of sex, racial, and/or national origin discrimination due to the fact that a disproportionate percentage of victims are women or racial and national minorities. The federal VAWA law we discussed earlier expresses what the FHA merely implies—namely, that landlords may not discriminate and must accommodate domestic violence victims, provided that the housing is federally assisted.

Whether under the FHA, VAWA, or state and local laws protecting domestic violence victims, landlords may have to allow tenants who claim they’re being physically abused or endangered to transfer to a different apartment on an emergency basis. However, you don’t necessarily have to take tenants at their word. VAWA and state/local laws allow landlords to request reasonable documentation—although not “proof”—of abuse (assuming, of course, that they don’t already know this from previous incidents or other indications). Although rules vary, you can generally ask tenants seeking domestic violence emergency transfers for:  

• A domestic abuse/sexual assault/stalking restraining order against the abuser;
• Evidence of a criminal charge against the abuser for domestic abuse/sexual assault/stalking for the tenant, their child, or a household member;
• A condition of release ordering the abuser not to contact the tenant, their child, or household member because of domestic abuse/sexual assault/stalking; and/or
• A protective order or letter from a “qualified third party,” such as a law enforcement officer, court employee, physician, nurse or other health care provider, counselor, clergy member, or crime victim advocate.

If housing is federally assisted, you can have tenants fill out the HUD form 5383 Emergency Transfer Request form. Here’s a chart provided by affordable housing consultant Gwen Volk, president of Gwen Volk INFOCUS, Inc., summarizing the kind of documentation you’re allowed to request when a tenant invokes her rights under VAWA.

VAWA Protection	Documentation	Deadline for Tenant to Provide
Tenant invokes rights	Tenant’s choice from HUD list (Certification form 5382 is considered documentation)	14 business days from receipt of landlord’s written request
Tenants invoke rights—conflicting claims	Landlord can require third-party verification to resolve the disagreement	30 calendar days from date of landlord’s written request
Tenant requests emergency transfer	Landlord can require tenant to complete the Emergency Transfer Request form. Landlord can’t request or require third-party verification.	Landlord can stipulate that request form be returned before a transfer occurs.

 

Coach’s Tip: It should go without saying that the information that domestic violence victims give you about their situation is highly sensitive and protected under the federal Health Insurance Portability and Accountability Act (HIPAA) and other privacy laws. That means you must limit access to a need-to-know basis and can’t disclose the information to staff, neighbors, tenants, and other third parties without the victim’s express written consent. That includes information about the victim’s current whereabouts. Exception: Disclosure without consent is allowed for certain narrow purposes, like where a law enforcement officer or court orders you to do so. Consult your attorney before disclosing confidential domestic violence information without consent.

Pitfall #9: Retaliating Against Tenants for Requesting a Transfer

You can’t evict, reject, or take any other adverse action against any person for requesting a transfer, especially when it’s for a reasonable accommodation of a disability. You can be liable even if retaliation is just one motive for a decision—for example, evicting a disabled tenant for not paying rent and requesting to be transferred as an accommodation.

Example: A tenant asked for a reasonable accommodation to move to a ground-floor unit after a car accident severely limited her ability to climb the stairs to her second-floor apartment. The Texas housing authority said no, forcing her to endure the pain and humiliation of having to crawl up and down the stairs. Adding insult to injury, the landlord then sought to evict her. Result: The tenant sued, and the housing authority entered into a Voluntary Compliance Agreement-Conciliation Agreement with HUD agreeing to:

• Pay the now ex-tenant $500,000 in damages;
• Clear any debts the housing authority alleged she owed;
• Pay a $10,528 civil penalty to HUD; and
• Overhaul its reasonable accommodation policies and pre-eviction grievance hearing procedures [Housing Authority of the City of Dallas, HUD No. 22-166, Sept. 9, 2022].