Follow Three Dos & Don’ts When Talking to Prospects

Staff members at tax credit sites can get into trouble when talking with prospects. Any false assurances, improper assumptions, or inappropriate statements could trigger noncompliance and a possible fair housing complaint or lawsuit. To avoid problems, here are three Dos & Don’ts you and your staff should follow when talking to prospects.

DON'T Assure Prospects They’ll Qualify for a Low-Income Unit

Don’t lead prospects to believe they’ll qualify for a low-income unit at your site, no matter what they tell you about their background or what their answers on a pre-application form may appear to reveal. Staff members are most likely to give assurances when prospects claim they earn little income. Don’t guess as to whether a prospect will qualify for a low-income unit based on what a prospect casually tells you. Such information is incomplete, premature, and unverified.

Many prospects are eager to learn whether they’ll be able to rent a unit at the tax credit rent. So they may tell you about their financial situation before they apply, in the hope that you’ll say whether they’ll qualify. For example, a prospect may say, “My husband and I earn only 20 grand a year. We should have no problem, right?”

But responding with assurances or leading on prospects in any way is inappropriate and can lead to liability. Even if you know that $20,000 for a two-person household in your locality falls under the income limit, you might later discover that the couple earn more income than they realized or chose to disclose. For instance, the couple might not think that the money they earned through odd jobs isn’t relevant. Also, prospects may own assets that could make them ineligible, despite a low salary from a job.

DO Allow Disabled Prospects to Initiate Conversation about Unit Choice Limitations

If you meet a prospect who you know is disabled—for instance, you see her using a wheelchair—don’t make assumptions about where she wants to live based on her disability. Many well-intentioned staff members think they’re helping prospects by making assumptions because it shows they’re attuned to their prospects’ needs. For instance, they’ll assume that a prospect who uses a cane wants to see only the site’s accessible or ground-floor units. Or they’ll assume that a hearing-impaired prospect would prefer to rent a unit that’s less expensive because it’s located next to a noisy compactor room.

But making such assumptions is unfair, and acting on them is considered “steering.” HUD regulations ban steering by saying “Assigning any person to a particular section of . . . or to a particular floor of a building because of race, color, religion, sex, handicap, familial status, or national origin” is illegal. And if your state housing agency discovers that you violated the Fair Housing Act, it must report you to the IRS for tax credit noncompliance.

Steering disabled prospects to particular units could also run you afoul of the tax credit law’s “for use by the general public” requirement. If you consistently show disabled prospects only your site’s accessible units, for instance, the argument can be made that you’re not keeping your non-accessible units open to the public, because you’re discouraging disabled prospects from renting them.

To avoid problems, always let prospects tell you about requirements or restrictions they have when choosing a place to live at your site.

DON'T Answer Inappropriate Questions about Residents

Often, prospects want to know about the race, ethnicity, or familial status of the residents at your tax credit site. But questions about the presence or number of people protected against illegal discrimination at your site are inappropriate. Answering these questions violates the Fair Housing Act even if you weren’t the one to raise the subject.

Even if the prospect asking the question has the protected characteristic he’s talking about, you or your staff members aren’t allowed to answer inappropriate questions. For instance, if a Muslim prospect asks you whether other Muslims live at your site, you shouldn’t respond. The fact that the prospect asking the question is also Muslim doesn’t make the question appropriate.

How should you respond to prospects’ inappropriate questions? You should come up with standard responses to all inappropriate questions. For instance, you could say, “Our company policy and fair housing law don’t permit me to answer that question.” Another response might be, “We’re complying with the law.” You should be polite but firm when responding to such questions.