Is it legal to report to LCB in the US? Is consent required from the tenant?
Yes, it is legal for landlords and property managers to report to LCB and they do not require consent from the tenant if they are reporting under an approved purpose described below.
Most people are aware that landlords are allowed to report tenant information to collection agencies and to reporting agencies, also known as credit bureaus, such as Equifax and TransUnion. Reporting to credit bureaus may happen indirectly through collection agencies or directly by landlords. While landlords legally may report directly to credit bureaus, Equifax and TransUnion have made a business choice to not typically deal directly with landlords unless they are very large. LCB does deal directly with landlords of all sizes. All three are reporting agencies in Canada (Equifax, TransUnion, and LCB).
The ability for housing providers to screen their applicants for rental history, credit and tenancy-worthiness and the practice of providing rental history to other landlords is recognized as an accepted and established practice throughout our industry.
Blacklists are illegal. LCB does not maintain any blacklists. LCB collects and reports both positive and negative information and provides tenants access to their records. Reporting tenant information to other companies who are not doing both of those things, and most of the additional steps below, is illegal and may create personal liability.
LCB is a specialty reporting agency in the US.
Reporting agencies are subject to local and federal legislation. LCB complies with, and in several instances exceeds, the requirements under that legislation.
Credit reporting, consumer protection and privacy legislation enables landlords to report to LCB, with consent, through implicit consent, or without consent when they are doing so for an approved purpose such as to ensure the collection of a debt owed to them, for investigation of a breach of an agreement or a law, to detect or suppress or prevent fraud, or when reporting is clearly in the interests of the individual. Collection agencies are also able to report without tenant consent.
LCB is legally able to share records and landlords are entitled to view tenant records in connection with extending credit as landlords do, collecting a debt, or in connection with the tenant wanting to enter into or renew a tenancy agreement. For situations where the landlord is considering extending credit or offering a tenancy agreement, landlords need to get consent from the tenant before viewing such tenant’s records with LCB.
LCB handles notifying the tenants, enables them to view and monitor their records, and if information is disputed, there are multiple mechanisms in place to handle such disputes. LCB will then investigate.
Users contractually agree to only report factual information and to only use LCB for a valid purpose, or risk personal liability. Both landlords and tenants are given the opportunity to provide information in a way that allows all sides to be heard and on the record.
Before allowing them to contribute data, LCB verifies all user’s identification, either through document submission or using a secure process provided by Equifax. We do not allow information to be contributed anonymously. LCB only reports information from landlords and tenants who have had their identity and legitimate purpose verified. LCB also maintains a record of anyone who contributes or views data. LCB’s goal is for all parties to fulfill their responsibilities and for both landlords and tenants to benefit as a result.
Tenants are given notice and provided free annual access to review and monitor their records. As an added protection, tenants can challenge incorrect information directly with LCB in several ways. Further, tenants are provided a grace period before data is shared with other credit bureaus, so that tenants have time to review their record and make sure the information is accurate.