Source of Income Discrimination: NYC Landlord Rules

Yes. Almost every NYC landlord and broker must accept Section 8, CityFHEPS, HASA, SSI and other housing assistance as payment, and cannot screen voucher holders out with income minimums, credit-score cutoffs or guarantor demands. The only exemptions under the NYC Human Rights Law are for a room in an owner-occupied unit and for a unit in an owner-occupied two-family house that was never publicly advertised.

This guide walks through what the NYC Commission on Human Rights (CCHR) says owners, managing agents and brokers can and cannot do, with the concrete examples the Commission itself uses. It is general information, not legal advice.

What counts as "lawful source of income"

Source-of-income discrimination has been illegal in New York City since 2008. The NYC Human Rights Law protects tenants and applicants based on their "lawful source of income." The Commission defines this as any federal, state or local public or housing assistance used toward rent. Its fact sheet names:

• Section 8 (Housing Choice Vouchers), including portable vouchers from other housing authorities
• CityFHEPS and FHEPS
• HIV/AIDS Services Administration (HASA) assistance
• Supplemental Security Income (SSI)
• Veterans' GI Bill housing allowances
• Security deposit vouchers and one-time emergency grants ("one-shot deals") for rent, deposits, move-in fees or broker fees

The list is not exhaustive. The Commission says "among others," so treat any government rent help as covered. For how the voucher programs themselves work, see CityFHEPS explained and renting with a housing voucher.

Is your building covered?

Probably. The Commission says most NYC rentals are covered regardless of the number of units, including co-op and condo apartments, single-room units, subdivided units and even illegal units. The two exceptions are narrow:

Income requirements: the 40x rule does not apply the usual way

Many NYC landlords ask that a tenant earn 40 times the monthly rent (see the 40x rule). For voucher holders, the Commission's position is direct: when a program calculates the tenant's share of rent based on their income, the government has already decided they can afford it. Imposing any additional income requirement is a violation of the law. Some tenants pay nothing out of pocket at all.

In practice that means you cannot hold a voucher holder to an income multiple of the rent or a flat salary floor. The Commission's own examples of unlawful requirements are "$68,000 annually" and "43x the monthly rent," and the same logic applies to the common 40x rule. You also cannot ask for proof of employment when the voucher covers the whole rent. The HRA flags "insist on a minimum income or proof of employment when the voucher covers the full rental amount" as a warning sign. Use the Section 8 rent share calculator to see roughly how a tenant's share is set.

Guarantors: You may not require voucher holders to find a guarantor or co-signer. The same goes for asking for cash, or for someone else to guarantee the rent, on top of a security deposit voucher.

Credit checks for voucher holders

The Commission says requiring a specific credit score is itself evidence of discrimination, and lists "Your credit score must be at least 600" as an example of discriminatory wording. If the tenant pays part of the rent, you can make a credit inquiry, but you should give them a chance to show they can pay their portion on time before rejecting them. If you deny based on a credit report, federal law also requires an adverse action notice (see tenant screening rules in New York).

Fees, holding deposits and security deposit vouchers

• Application fees are capped by state law at the actual cost of a background or credit check or $20, whichever is less (Real Property Law § 238-a). This applies to everyone, not only voucher holders.
• No holding deposits. The Commission says you should not charge extra fees, deposits or rent until the agency running the voucher has approved the move-in and you are ready to hand over possession.
• Deposit vouchers must be accepted unless you are exempt. That applies to co-ops, condos, market-rate and rent-stabilized apartments alike.
• Broker fees paid by HRA may be paid after move-in, according to the Commission.

Do and don't: examples from city guidance

Longer processing times, extra paperwork, lower broker fees or a deposit paid by voucher instead of cash are not lawful reasons to turn an applicant away, according to the Commission.

Screening software and housing court records

The Commission warns that relying only on tenant screening bureaus or automated scores can exclude voucher holders and other protected groups. Each applicant should be looked at individually. Most screening reports also list past landlord-tenant cases, and New York State law separately bars rejecting an applicant because of a pending or prior housing court case.

Your existing tenants

If a current tenant becomes eligible for a voucher or subsidy, you cannot refuse the payments. The Commission says you must complete the program paperwork and make sure the unit passes the program's housing quality inspection. Refusing or delaying repairs because a tenant pays with assistance is also prohibited.

You are responsible for your brokers and staff

Owners are liable for anyone who processes applications for their units, including supers, independent contractors, brokers and salespeople who are not employees. If you find out an agent turned away a voucher holder, the Commission recommends:

1. 1

   End the relationship

   Terminate the agent and related brokerage for the discriminatory conduct.
2. 2

   Log it

   Record the broker or agent, the applicant and all known details of the denial.
3. 3

   Report it

   Notify the Commission at 212-416-0197.
4. 4

   Keep the paper trail

   Save all communications with the agent or company.
5. 5

   Make the applicant whole if you can

   If you still have a vacancy, offer the unit to the otherwise-qualified applicant to limit damages.

What a violation can cost

• Civil penalties of up to $250,000 per violation for willful violations.
• Compensatory and emotional distress damages to the applicant, with no cap. The Commission notes that if an applicant stays homeless after an unlawful denial, you can be held accountable for that distress.
• The complainant's attorney's fees.
• Compliance monitoring by the Commission for months or years. Settlements the Commission has publicized have also required staff training, posting the Commission's notices and setting aside apartments for voucher holders.

The Commission's Source of Income Unit sits in its Law Enforcement Bureau. It handles emergency interventions, where staff call a landlord or broker to explain the law, often so an applicant can still get the apartment. It also runs matched-pair, phone and online testing to catch discriminatory listings.

A compliance checklist for your next vacancy

1. Remove any wording about programs, vouchers, "working" status, minimum income or minimum credit score from listings.
2. Write down your screening criteria and apply them the same way to every applicant.
3. For voucher holders, drop the income multiple and guarantor requirement.
4. Skip credit review entirely when the voucher pays the full rent.
5. Charge no more than the $20 or actual-cost background fee, and no holding deposit.
6. Brief every broker, agent and super who shows units; you are liable for them.
7. Respond quickly to program paperwork and inspections.

Related reading: NYC fair housing rules for landlords, the Fair Chance Housing law and FARE Act rules for landlords. Renters who think they were turned away can read source-of-income discrimination: is it happening to you?