California Public Records - not so public anymore!

AB 2819 prohibits access to the majority of eviction records – removing an important tool in the landlord’s risk management arsenal.  What to do??fotolia_99206126


Previously, eviction lawsuits (termed unlawful detainers or UD’s in legal circles) became public 60 days after the filing date - unless the tenant prevailed within 60 days of the filing date.  Ironically, it is the eviction that just occurred, and that has not found its way onto the credit (or tenant screening) report that may represent the greatest threat to the landlord.

Not satisfied, advocates argued that while UD’s are supposed to be heard within 20 days of filing, delays commonly pushed hearings past the 60 day mark.  Those (tenants) who then prevail are unfairly associated with an eviction lawsuit, which of course, has a negative impact on their access to housing.

AB 2819 addresses that concern by “masking” eviction lawsuits permanently unless a judgement is entered in favor of the landlord within 60 days of the filing.

The problem is that relatively few UD claims are pursued to judgment.  The majority are dropped (or dismissed) by the landlord when the applicant pays or moves out.  It is simply contrary to the landlord’s interest to pursue most filings to judgment – given the considerable cost and low odds of recovery.  Just to recap:

  1. The majority of filings have merit.
  2. Most UD lawsuits are dismissed – not because they lack merit, but because a settlement was reached (the tenant paid or moved out) and because the time, expense and odds of collecting on a judgment make it a bad idea.

So as it stands, the only eviction records available to landlords in California are those decided in favor of the landlord within 60 days of the filing date.  In other words, squat!?

Note too that Experian, Equifax and Transunion have announced that they will discontinue reporting the majority of civil record judgments (which includes eviction judgments) beginning mid-2017 as part of their National Consumer Assistance Plan.

What to do?!

AB 2819 left a gaping hole in our defenses.  That ship has sailed, however.  We have a choice.  We can either accept the impact on risk management or we can find another way to reduce the odds of renting to a serial evictee - those with a history of violating the terms of their rental agreement.

The Answer

Verifications!!  They are decidedly low tech, but very effective.  Done well, they are fair to landlords and tenants.  Done well – questions asked elicit objective responses like the number of late payments, noise complaints – whether they gave proper notice.  Done well, references include disclosed and undisclosed rentals – addresses found in the header of the consumer credit report, an SSN trace, or in the public record.  Done well, they mitigate the disparate impact discrimination exposure.  Hard to imagine a more direct and less discriminatory way to measure the likelihood an applicant will fulfill the terms of their rental agreement.

The Bottom Line

We must work together as an industry to protect ourselves from what is well intended but misguided public policy.  We must assist one another by providing honest and objective feedback when called upon for a reference.

Our advice to clients!  Do them!!  Do rental verifications.  Do them yourself or outsource them to your screening company.  Do them right.  Ask the same questions the same way each time.  Ask questions that elicit objective responses.

Visit Moco Incorporated or® for more information on this and similar topics.