As a landlord, you need only accomplish one easy task, do it consistently, and you can avoid the headache and financial drain of this legal vulnerability.
Document your screening criteria. Though your criteria may vary greatly from another landlord's criteria, all documented criteria should:
1.) Comply with federal, state and local laws in addition to fair housing requirements. Information specific to your location can be found at Federal Fair Credit Reporting Act.
If you are not certain that your criteria are in compliance with regulations, be sure to have an attorney review the screening document and offer advice.
2.) Depend on quantifiable and verifiable data to effectively eliminate personal views or unintentional bias.
3.) Be written clearly with easily identifiable expectations
4.) Include an effective date in addition to effective dates for any changes or additions made to the criteria.
5.) Be IMPLEMENTED CONSISTANTLY. This is huge. Documenting the screening criteria is only going to protect you if you follow the criteria with every applicant.
As you outline your specific criteria, remember a tenant will only be accepted if they meet your criteria. Be comfortable with your standards. Know that they are in place for a good reason and be able to explain your reasoning to possible tenants.