Q’s & A’s: Refugee Tenancy Applications

Disclaimer:  This posting is for information only, and should not be used as legal advice. Please retain the services of a licensed legal professional to obtain advice specific to your situation.

 

Q. As a landlord, is there a special process for administering rental applications from refugees?

No, there is not. Rental applications from refugees should be processed in the exact same manner that you would administer any other application from a prospective tenant.

The Ontario government is developing a plan to help support settlement for refugees, but at this time there is no formal initiative involving the provision of rental housing as short-term living accommodation provided as emergency shelter for refugees (which could make such accommodations exempt from the Residential Tenancies Act).

Any rental application you receive from a government- or privately-sponsored refugee, asylum seeker, landed immigrant or permanent citizen should be treated and processed in an equal and consistent manner, and in full compliance of Ontario’s Residential Tenancies Act and Human Rights Code.

 

Q. Are landlords required under law to provide rental housing to refugees?

Under Ontario’s Human Rights Code, landlords are required to assess rental applications from refugees in the same non-discriminatory manner as you would from any other prospective tenant. Your decision to approve rental applications should be made in the usual manner by requesting and considering information on rental history, credit references and/or credit checks, income information, and the ability of the applicant (or a third-party guarantor) to pay the monthly rent on time.

 

Q. Is the government paying any subsidies for refugee tenant applicants, or acting as a guarantor?

No. At this time FRPO is not aware of any level of government providing direct subsidies or rent guarantees to rental housing providers who provide accommodations to refugee tenants.

 

Q. I have been contacted by a refugee sponsor who only wants “short-term” rental accommodation. What should I do?

As a rental housing provider it is your decision to agree to an initial length of term for the lease agreement. Most tenancy agreements have an initial term of 12-months, but you may decide to have a 6-month lease if you believe that will be more suitable. The tenant will be obligated for pay the monthly rent for the duration of the term. The tenant can then terminate their tenancy at the end of the term by providing an N9 form with 60-days notice to the landlord, and choosing the last day of the term as the termination day on their notice.

The tenant does NOT have to move out when the term ends. The tenant has the right to remain in their unit as a monthly tenant. Or, they can renew for another term if both the tenant and the landlord agree. If the fixed term has ended, the tenancy automatically renews at the end of each rental period. The most common rental period is a month, and the tenant remains obligated to pay the agreed-to monthly rent on time (plus any allowable annual rent increases).

 

Q. Can a refugee sponsor be a guarantor on the lease agreement?

Yes, if you believe they have the ability to guarantee the payment of monthly rent payments.

 

Q. What if the tenant can’t pay the rent? Do I file an application against the guarantor at the Landlord Tenant Board?

No. Guarantors have no official standing under the Residential Tenancies Act or Landlord Tenant Board. Should a tenant not pay the rent on time, a housing provider should proceed in the usual manner by serving an N4 “Non-Payment of Rent” notice against the tenant, then applying for a Board hearing should the rent continue to not be paid. Claims against Guarantors can only be pursued through small claims court.

 

Q. Should I require all tenant applications to have a guarantor?

Under the Human Rights Code, a landlord can require guarantees for the rent. The most common way of doing this is to ask that a guarantor also sign the lease agreement. If you do require guarantors to sign your lease agreement, you should do so for all tenancy agreements, not just for certain categories of people. For example, it could be considered a Human Rights Code violation if a landlord only required guarantors for students, or immigrants or people receiving social assistance.

Your rental application process should be equitable, consistent and non-discriminatory for all prospective tenants. Many housing providers employ a rigorous application process to protect against fraud and financial loss. It is important to ensure that your sound business practices, such as requiring a guarantor, are applied to all prospective tenants in the same manner, in compliance with the Human Rights Code.

 

Q. Are new immigrants or refugees a financial risk to rental housing providers?

No. There is absolutely no evidence that new immigrants or refugees increase the risk of unpaid rent or financial default. In fact, Citizenship and Immigration Canada affirms that new immigrants – and in particular refugees – pose a far lower risk group than the general population.

 

Q. I have a guarantor who says they will only sign as a guarantor for 12-months. Is this possible?

If a third-person signs the lease agreement as a guarantor, they will be the guarantor for the life of the tenancy lease. You have a legal right to pursue them in small claims court for any unpaid rent. You should note, however, that attempts by housing providers to obtain unpaid rent from a guarantor in small claims court in Ontario are not always successful.

 

Q. Can a landlord collect a rent deposit?

Yes. A landlord can collect a rent deposit as long as they ask for it on or before the day that the landlord and tenant enter into the tenancy agreement. The rent deposit cannot equal more than one month’s rent, or the rent for one rental period, whichever is less. For example, if rent payments are made weekly, the deposit cannot be more than one week’s rent; if rent payments are made monthly, the deposit cannot be more than one month’s rent.

The rent deposit must be used for the rent for the last month before the tenancy ends. It cannot be used for anything else, such as to pay for damages.

 

Q. Can a rental housing provider collect “pre-paid” rent from a tenant?

As long as the tenant offers to pay rent in advance and the Landlord then accepts it, there is little risk of collecting “pre-paid” rent for multiple months. The prepayment is not an illegal charge because it is not a “security deposit”. Prepaid rent is payment of rent in advance of the date it is due, and it should make no difference if it is paid 12 days before it’s due or 12 months. So, as long as prepayment of rent is not a pre-condition of acceptance of a rental application, then there should be no legal liability if a tenant offers to pre-pay the rent and a rental housing provider decides to accept.

 

Q. Can a rental housing provider require a signed termination notice as a condition of approving a lease application?

No. Under Section 37 of the Residential Tenancies Act, a tenant’s notice to terminate a tenancy is void if it is given at the time the tenancy agreement is entered into, or if it is given as a condition of entering into the tenancy agreement.

 

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