How to Screen Tenants Legally in Ontario (Without Violating Human Rights Laws)
Finding the right tenant for your rental property in Ontario involves more than a gut feeling. The screening process should balance your need for qualified renters with the legal requirements of Ontario rental laws and human rights legislation. By closely following Ontario landlord-tenant laws, you can develop a screening process that protects your investment while staying on the right side of the law.
Key Takeaways
- The Ontario Human Rights Code prohibits discrimination in housing based on multiple protected grounds, including race, age, religion, and family status.
- Standardized application forms help ensure consistency and fairness in your screening process.
- Income verification should focus on the ability to pay, not the source of income, which is protected under Ontario landlord-tenant laws.
- References from previous landlords can provide valuable insights when they incorporate specific, legally-appropriate questions.
- Credit checks require explicit written consent and must be used as only one factor in your decision-making.
- Thorough documentation of your selection criteria and process helps defend against discrimination claims.
Table of Contents
- Ontario Rental Laws Surrounding Tenant Screening
- Ontario Human Rights Code
- Ontario Residential Tenancies Act
- Privacy Legislation
- Step 1: Create a Standardized Application Form
- Step 2: Verify Income and Employment
- Step 3: Check Rental References
- Step 4: Conduct Credit Checks
- Step 5: Perform Background Checks Within Legal Limits
- Step 6: Make Your Decision and Communicate Appropriately
- FAQs About Ontario Rental Laws
- What Questions Am I Legally Prohibited from Asking Potential Tenants?
- Can I Refuse to Rent to Someone Because They Have Children?
- Is It Legal to Ask for a Guarantor or Co-Signer on a Lease?
- Can I Run a Credit Check Without the Applicant’s Permission?
- What Should I Do If an Applicant Has No Rental History?
- How Can I Verify Income for Self-Employed Applicants?
- What Are the Eviction Rules in Ontario If I Later Discover a Tenant Lied on Their Application?
Ontario Rental Laws Surrounding Tenant Screening
In Ontario, tenant screening is governed by multiple legal frameworks. The consequences of violating these laws can include complaints to the Human Rights Tribunal, financial penalties, and damage to your reputation.
Ontario Human Rights Code
The Ontario Human Rights Code prohibits discrimination in housing based on protected grounds, including race, ancestry, place of origin, colour, ethnic origin, citizenship, creed (religion), sex, sexual orientation, gender identity, gender expression, age, marital status, family status, disability, and receipt of public assistance. These protections apply throughout the entire rental process, including advertising, tenant selection, and occupancy.
Ontario Residential Tenancies Act
The Ontario Rental Tenancy Act establishes rights and responsibilities for landlords and tenants, but doesn’t specifically regulate screening processes. However, it does protect tenants from discrimination and harassment, including during the application process.
Privacy Legislation
While collecting information during screening, you must respect applicants’ privacy rights. This means only gathering information relevant to tenancy decisions and securing consent before conducting credit or background checks.
Step 1: Create a Standardized Application Form
A well-designed rental application form is the foundation of your screening process. It should collect relevant information without breaching privacy or human rights laws.
Your rental application should include:
- Full names of all potential occupants
- Current and previous addresses (ideally covering 3-5 years)
- Contact information
- Employment details, including employer, position, and length of employment
- Income information
- References from previous landlords
- Emergency contacts
- Consent for credit and background checks
- Vehicle information, if applicable
- Pet information, if applicable
Avoid questions that could be seen as discriminatory, such as those related to:
- Race, religion, or ethnic background
- Sexual orientation or gender identity
- Disability status
- Age (except to verify legal capacity to sign a lease)
- Marital or family status
- Citizenship (you can verify legal right to reside in Canada, but not citizenship)
- Source of income (you can verify income amount, but not source)
Having applicants sign and date the form acknowledges their consent and creates a record of the information provided. Store these applications securely and use identical forms for all applicants to ensure consistency.
Step 2: Verify Income and Employment
Income verification helps determine if applicants can afford the rental unit, but it must be done carefully to avoid discrimination under Ontario rental laws. Whatever income standard you set, apply it consistently to all applicants.
Acceptable verification methods include:
- Pay stubs (recent, from the past 1-2 months)
- Employment letter stating position, tenure, and income
- Notice of Assessment or T4 forms from the previous tax year
- Bank statements showing regular income deposits
Remember that Ontario human rights law prohibits discrimination based on source of income. This means you cannot reject applicants solely because they receive social assistance, disability benefits, alimony, or other non-employment income. The ability to pay, not the source of funds, should be your focus.
Step 3: Check Rental References
Previous landlords can provide insights into an applicant’s rental history. They can verify whether a tenant paid rent on time, maintained the property well, and followed rules.
When contacting references, you can ask questions like:
- Did the tenant pay rent on time?
- Were there any lease violations?
- Was proper notice given before moving out?
- Did they leave the property in good condition?
- Would you rent to this person again?
Be cautious of references from friends or family posing as landlords. You can verify property ownership through municipal tax records or property registries. Also, try to contact the landlord before the current one, as current landlords might give a positive reference simply to encourage a problematic tenant to move.
If an applicant has no rental history, consider alternative references such as character references from employers or teachers. First-time renters shouldn’t be automatically disqualified, but may require additional verification in other areas.
Always document rental reference checks, including contact information, date of conversation, and responses to your questions.
Step 4: Conduct Credit Checks
Credit checks reveal an applicant’s financial reliability and debt management habits, but must be handled in accordance with privacy laws and the Ontario Rental Tenancy Act. You must obtain written consent and have a privacy policy in place stating how you will use and protect their information.
When reviewing credit reports, focus on:
- Payment history (especially for utilities and past rent)
- Debt-to-income ratio
- Bankruptcies or consumer proposals
- Collection accounts, particularly from utilities or past landlords
While a perfect credit score isn’t necessary, look for patterns that might indicate financial responsibility issues. Medical debt and student loans should be viewed differently from consumer debt when assessing rental worthiness.
If you decline an applicant based partly on credit information, consider providing general feedback (without violating privacy laws), such as “We require a minimum credit score of X” or “Recent payment history doesn’t meet our requirements”.
Step 5: Perform Background Checks Within Legal Limits
Background checks can include criminal history, eviction records, and identity verification, but Ontario landlord-tenant laws and privacy regulations limit how these can be used. Eviction records in Ontario are available through Landlord and Tenant Board decisions, which are public. However, these should not be your only decision factor, as the circumstances behind evictions vary greatly. Eviction rules in Ontario allow for evictions for various reasons, and not all reflect poorly on a tenant.
Online searches and social media reviews may provide additional information, but use this data cautiously. Information found online may be inaccurate, out of context, or irrelevant. Focus only on information that directly relates to being a good tenant, such as lifestyle factors that might affect property care.
Identity verification is reasonable to prevent fraud. You can request government-issued photo ID to verify an applicant’s identity, but make photocopies only with explicit consent and store them securely.
Step 6: Make Your Decision and Communicate Appropriately
The final step in your screening process is selecting your tenant and communicating decisions professionally.
When approving an applicant:
- Contact them promptly
- Provide clear next steps for lease signing and move-in
- Request any additional information needed for the lease
- Set expectations regarding security deposits and the first month’s rent
When declining an applicant:
- Keep communications brief and professional
- Focus on objective criteria not met (“We require tenants to have income at least 3x the monthly rent”)
- Avoid comparing them to other applicants
- Don’t specify which protected characteristic was concerning (even if you rejected them for legal reasons)
Under Ontario landlord-tenant laws, once you accept an application and the tenant pays a deposit, you have effectively entered an agreement. Changing your mind after accepting could lead to legal issues.
For many landlords, the screening process can be time-consuming and legally complex. If you’re looking for expert assistance with tenant selection that fully complies with the Ontario Rental Tenancy Act, Property Management Toronto can help. Our team understands the nuances of Ontario landlord-tenant laws and can handle the entire screening process for you, ensuring you find qualified tenants while avoiding potential legal pitfalls. Contact us to learn how our tenant screening services can save you time and reduce your risk.
FAQs About Ontario Rental Laws
What Questions Am I Legally Prohibited from Asking Potential Tenants?
Under the Ontario Human Rights Code, you cannot ask questions about race, ancestry, place of origin, colour, ethnic origin, citizenship, creed, sex, sexual orientation, gender identity, gender expression, age, marital status, family status, disability, or receipt of public assistance. Focus instead on the ability to pay rent, rental history, and willingness to comply with lease terms.
Can I Refuse to Rent to Someone Because They Have Children?
No, family status is a protected ground under Ontario rental laws. You cannot refuse to rent to applicants because they have children. Housing policies that appear neutral but disproportionately affect families with children (like “adult-only” buildings) are generally considered discriminatory.
Is It Legal to Ask for a Guarantor or Co-Signer on a Lease?
Yes, requesting a guarantor is legal if it is based on objective criteria, such as insufficient rental history or income below your minimum requirements. However, it’s discriminatory to require guarantors only from certain groups (like newcomers to Canada or young people) rather than applying the same standards to all applicants.
Can I Run a Credit Check Without the Applicant’s Permission?
No, you must obtain explicit written consent before conducting a credit check. This consent should be included in your rental application form. Running a credit check without permission violates privacy laws and may have legal consequences.
What Should I Do If an Applicant Has No Rental History?
Consider alternative verification methods such as employment references, character references, proof of regular bill payments, or bank statements showing financial responsibility.
How Can I Verify Income for Self-Employed Applicants?
Request tax documents such as Notice of Assessment or T1 General forms from the previous 1-2 years, bank statements showing business deposits, or statements from an accountant. The verification process might be more detailed than for traditionally employed applicants, but the standards should remain fair.
What Are the Eviction Rules in Ontario If I Later Discover a Tenant Lied on Their Application?
If a tenant materially misrepresented information on their application, you may have grounds for eviction under the Residential Tenancies Act. You would need to apply to the Landlord and Tenant Board using Form N5 (Notice to Terminate a Tenancy Early), citing interference with lawful right or interest. However, success depends on proving the misrepresentation was significant and intentional.