Compliance Monitoring – A Fair Housing Must

When was the last time you did a compliance audit of your documentation forms and procedures for your rental properties? Why is it a critical practice that should be done regularly? This article will share why compliance monitoring is important and share some helpful tips to either get you started or fine-tune your process.

Compliance Monitoring – Fair Housing Implications

Let’s start by defining what compliance monitoring is. Compliance monitoring is basically just what it sounds like. It is a checks and balances procedure that should be done regularly to see if you are following your predetermined policies and procedures, especially when there could be fair housing implications.

Larger companies have an entire department dedicated to overseeing compliance. But for smaller companies and self managing landlords, this means that the responsibility will fall on you.

Either way, compliance monitoring helps a company identify any potential problems and correct them before they snowball or, even worse, are discovered during a fair housing investigation.

A Common Breakdown Point – Documentation

Consider this scenario; a rather irate resident calls to complain that they received a rent increase when their neighbor did not. You immediately check both residents’ files to see if there is supporting documentation as to why this happened but find nothing. Now what? More than likely, this is just an oversight, but unfortunately, you now have no way to prove why one resident received a rent increase when another did not, and it could be construed as discrimination.

In this scenario, we have not one but two failures. Firstly, there was the failure to document the reason for the difference in rent. And secondly, the failure could have been caught before a resident became involved if there had been a regular check or compliance monitoring procedure in place.

Steps for Better Compliance Monitoring

The first and most important step in compliance monitoring is training! As an owner or manager, you should never assume that everyone knows what they need to be documenting or what your company’s policies and procedures are. Every staff member, regardless if they are new or a seasoned veteran, should receive training as to your policies and procedures. Also, training should not be a one-and-done thing but a continual process instead.

If you employ a property management company to handle your rental property, this would be a great question to ask them about.

Once you have established a regular training regime, you need to think about how you are going to check in to ensure that it’s working. As we mentioned earlier, some larger companies have an entire department dedicated to this, but if you are a smaller company, you need to clearly identify who will be responsible and how often they will be performing a spot-check or audit.

If a compliance issue is identified, the next step to take is to take a deep breath and use this as a teachable moment for all involved. Share where the breakdown happened and discuss better practices to avoid it in the future, and be sure to follow up that they are.

The final takeaway when it comes to proper compliance monitoring is that training and follow-up are essential to identify any problems to avoid or challenge a fair housing complaint. 

Not sure if you need set criteria for your rental property business? Check out our blog, How and Why Landlords Want to Create Standard Operating Procedures for Their Rental Property Business

Want to learn more about Fair Housing? Check out The Fair Housing Institute and use code YLR2023 to receive 15% off any course!