Imagine a system that tracks your every move. Everywhere you've ever lived, everytime you've paid -- or not paid -- rent, every place you've moved to, a system that collates all the data about you, good and bad, and spits it out in the form of a random number.
Know what? The system already exists. It can determine whether or not you'll get a place to live, and its decisions tend to be final. Worse, the people that use these numbers on a day-to-day basis can't explain exactly how the system works, or what happens when it doesn't work.
No, Microsoft isn't getting into real estate, although they do play a part in the story we're about to tell. Welcome to the world of rental screening.
The Business of Strangers
There are literally hundreds of agencies throughout the United States alone that offer comprehensive rental screening services for landlords, property managers and real estate brokers. Each agency or service claims to provide exhaustive records on a prospective renter's history, including their credit background, arrest record (if any), employment verification, and proof of identity.
First American Registry (FAR), the self-proclaimed "nation's largest resident screening company" claims "an exclusive database of 34 million landlord-tenant records and lease performance histories reported by property managers nationwide."
YouCheckCredit.com offers instant tenant screening reports and credit checks "24 hours a day, 7 days a week, 365 days a year" -- all "in less than 10 seconds via the Internet."
In addition to rental histories, ASAP Screening in Florida helpfully provides "pre-employment screening services including criminal searches, driving records, credit reports, social searches, drug testing, and workers compensation claims reports."
Clearly, there's a lot of information out there, and selling it is big business. SafeRent -- now owned by First American, the parent company of First American Registry (FAR) -- generated approximately $40 million in revenue in 2003. (Calls to FAR's marketing department were not returned.)
Rental screening, overall, has become a serious business practice within the last decade or so. Yet, within that time, the practice has generated huge numbers of companies and industry ventures who are willing to share information quickly and efficiently with anyone who asks -- anyone, that is, except the consumers themselves.
According to Julia Thompson, president and founder of References-Etc.com, individuals can get turned down for a job or denied a chance to rent an apartment, and "never know why. The letters that people have a right to see never get sent out, even though employers know that they should be, due to the Fair Credit Reporting Act (FCRA)."
Jeffrey Wilens, a California attorney specializing in consumer law, believes rental screening can harm consumers for years, due to "stale or incomplete information about a previous lawsuit".
Consider this. A rental screening system can provide potential landlords an instant credit check in less than an hour. Yet in order for an individual to gain access to their own credit file, they either have to be denied credit, fulfill the terms of a free credit disclosure as mandated by the FCRA, or pay one of the three major credit bureaus to see their own report.
And not only that, the reports a consumer sees may differ greatly than what a leasing manager or landlord sees.
What goes into the rental screening process? Who performs it? And most importantly, why does it exist?
Next: Who's Been Sleeping In My Bed?