SafeRent accused of unfairly labeling Black, Hispanic applicants high-risk

Tenant-screening service allegedly discriminated against voucher holders

A photo illustration of discrimination against tenants (iStock)

A tenant-screening service is being accused of violating fair housing laws by discriminating against low-income tenants of color.

The National Consumer Law Center filed a lawsuit in federal court last week against Texas-based SafeRent Solutions, Law360 reported. The center alleged SafeRent violated the Fair Housing Act and state laws by giving poor risk-profile scores to Black and Hispanic rental applicants with housing vouchers, the suit claimed.

The risk scores resulted in some of those carrying vouchers to be denied housing, according to the lawsuit.

The lawsuit claimed SafeRent Scores accounts for credit history and non-tenancy debts but not the benefits provided by housing vouchers. According to the suit, this disproportionately hurts Black and Hispanic applicants, who typically had lower credit scores than white ones.

“Credit scores and conventional credit history are not accurate predictors of a successful tenancy,” Christine Webber, co-chair of the Civil Rights and Employment practice at law firm Cohen Milstein, stated in a release. Greater Boston Legal Services and Cohen Milstein are also representing the plaintiffs.

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Representatives of the plaintiffs also expressed concerns that SafeRent’s algorithm doesn’t disclose all of the data it uses, obscuring how bias may have an impact on the scores.

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SafeRent Solutions didn’t immediately respond to a request for comment from Inman.

This is not the first time Cohen Milstein and SafeRent have found themselves on the opposite sides of litigation. In 2018, the law firm filed a racial discrimination lawsuit against the screening service related to artificial intelligence. That case is still being litigated.

SafeRent used to be known as CoreLogic Rental Property Solutions. CoreLogic divested itself from SafeRent in February 2021.

Discrimination against bearers of housing vouchers has been a problem for decades.

Last month, Compass settled a lawsuit in which watchdog group Housing Rights Initiative accused the brokerage of discriminating against tenants trying to use vouchers. Compass agreed to award larger commissions to agents for Section 8 leases and add training so they understand voucher programs better.

Vouchers provide predictable rent revenue, but some landlords prefer not to deal with the bureaucracy involved in renting to voucher holders or are looking for tenants with incomes too high to qualify for vouchers. However, it is illegal to discriminate against rental applicants based on the source of their income.

[Inman] — Holden Walter-Warner