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On January 1, 2025, Local Law No. 24, the Fair Chance Housing Act will become effective. The law severely limits the use of criminal background information in the sales of cooperative apartments. The law makes it unlawful discriminatory practice for housing providers to deny housing based on certain arrest or conviction records. The law states that Housing providers, including Cooperative Corporations, cannot deny housing based on criminal background unless the applicant:
1. Is on a sex offender registry or
2. Has multiple close-in-time convictions, meaning three years from the date of release of incarceration or date of sentencing if the applicant has not yet served the time for a misdemeanor conviction or five years from the date of incarceration or date of sentencing if the applicant has not yet served the time for a felony conviction.
Of great importance is that the criminal search can only be performed on the prospective purchaser once they are fully vetted and otherwise approved to buy the cooperative apartment or rent the premises. What constitutes a criminal background check is extremely broad and goes far beyond hiring a third-party vendor to run a search.
Asking a candidate about their criminal background, searching on a public search engine, and probably checking social media constitute a background check. Property owners must also delete any questions about an applicant’s criminal background from application forms.
Adverse action cannot be taken against a housing applicant based on a criminal background check until the property owner:
1. Provide the housing applicant with a written copy of the records/report;
2. Has given the housing applicant five business days to correct any errors in the records/report and provide any mitigating information in support of the application;
3. Review the information provided by the housing applicant in connection with the criminal history and
4. Provide the candidate with a written reason for the adverse action with supporting documentation, including the property owner's legitimate business interest and how the mitigating information/corrections submitted by the candidate were accounted for.
Suppose a property owner chooses not to perform a background check. In that case, the law grants it immunity from liability in any civil action arising as a result of an alleged act of an individual with a criminal history based on the claim that the property owner should not have sold, rented, or leased to such an individual because of his or her criminal background.
Please contact our office if you have any questions.
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