The Fair Housing Act: Protecting Your License and Your Clients

The Fair Housing Act Protecting Your License and Your Clients

No matter what part of the country you work in, real estate agents and brokers must adhere to the Fair Housing Act (FHA). The FHA prohibits housing discrimination on the basis of race, color, national origin, religion, sex, disability and familial status. With so many protected classes, it’s easy to accidentally break the law without knowing it. Here are some practical suggestions on how to keep your license by following the FHA while protecting your clients.

A comprehensive legal overview

In 1988, the U.S. Congress passed the Fair Housing Act, which prohibited housing discrimination on the basis of race, color, religion, sex or disability. The Fair Housing Act is a federal law that applies to all aspects of renting or buying a home as well as mortgage lending and insurance products. Violations could result in fines against an individual or institution up to $50,000 for first-time offenses and higher penalties for repeat offenders. Penalties also may include jail time of up to one year. So what does this mean for you? It means that if you are either providing services to real estate clients (sales agents, brokers) or listing property for sale, it’s your responsibility to educate yourself about how Fair Housing laws affect your transactions. What might seem like common sense may not be enough. For example, if you show homes only in neighborhoods where your client matches the racial demographics, it’s illegal because it limits their choices based on race. Similarly, if you refuse to list homes with wheelchair ramps because they require renovations your client can’t afford – then that too would be illegal because you are discriminating based on disability.

What the law prohibits

It is a violation of the Fair Housing Act in Real Estate to discriminate against a potential homebuyer based on gender, race, color, national origin, religion, familial status or disability. Under this law, it is also illegal to block certain groups from seeing available properties or getting information about homes for sale. The Fair Housing Act protects both buyers and renters because housing discrimination has a negative impact on communities. Everyone deserves equal opportunities when looking for homes or apartments. This act helps break down societal barriers by ensuring all people have an equal chance at securing housing in their desired location.

How the law will be enforced

No one should be discriminated against, not in the housing market, employment market, or in any other situation. This is why the Fair Housing Act was passed to protect consumers from discrimination based on their race, color, national origin, religion, sex (including gender identity), familial status (including children under the age of 18 living with parents of legal custodians), and disability. Some exceptions to this rule include a religious organization or nonprofit for its own use; a private club when not providing housing accommodations; single-family homes used as residence by owner with no intention of renting it out; timeshare agreements; home sales subject to the Federal Home Ownership Equity Protection Act.

Are there exceptions?

There are exceptions for some of the ways in which a real estate license can be revoked. It is illegal to discriminate in any way against any person because of race, color, religion, sex, disability, familial status (having one or more children under the age of 18), or national origin. It is also illegal to advertise your property with such discrimination. Violations of this act could lead to possible fines and/or a loss of licensure depending on the severity of the incident. Additionally, it is unlawful to retaliate against someone who has exercised their rights under the Fair Housing Act by trying to coerce them into not reporting housing discrimination or refusing their application for housing.

What does this mean for you?

Do you recall any of your high school civics classes? One of the key concepts taught was the idea that all citizens should be treated equally under the law. The Fair Housing Act of 1968 ensures that everyone is able to purchase or rent a home without facing discrimination due to their race, religion, sex, national origin, or other characteristics. Violating this federal act can result in costly fines against the person discriminating as well as against your agency if you participate in these practices. When it comes to landlords looking for renters or homebuyers, they are not allowed to make decisions based on an applicant’s race.

How can you protect yourself?

As a real estate agent, you must adhere to the federal laws under the Fair Housing Act in Real Estate. You are not permitted to discriminate against any individual or household based on race, color, religion, sex, familial status or national origin. This means that no one can be denied access to a home they are interested in buying based on their race or ethnicity. But this is just part of the Fair Housing law that applies to your license-related situation as well as protecting potential clients who may have been discriminated against by other real estate agents in your area. You need to know what you are required to do when an individual or family contacts you regarding the sale of their property.