Limits on Rental Application Fees
California is home to some of the world’s most expensive rental markets. Since most renters are numb to the astronomical prices, few pay any attention to the various fees that landlords tack on when signing a lease agreement. However, California limits the fees a landlord can charge in connection with screening new applicants.
California landlords are allowed to charge application screening fees, subject to certain restrictions. When you view an apartment, you will often complete an application for the landlord and/or their agent. Along with the application, you will more than likely be asked to provide an application fee. This fee is not just for the application, but it is an applicant screening fee that allows the landlord to use the fee to gather additional information about the applicant. This additional information can be in the form of personal reference checks or consumer credit reports.
The amount the landlord and/or agent can charge, cannot be more than the landlord’s out-of-pocket costs in obtaining that information. In addition to not collecting over out-of-pocket expenses, California law limits the maximum application fee charged to the current Consumer Price Index amount. The current Consumer Price Index for 2017 is $47.72.
You have the right to ask what is included with the application fee. Make sure to inquire whether there is an actual unit available within a reasonable time of completing your application. If there is no rental unit available, a landlord and/or agent may not charge an application fee. If your landlord and/or agent is using the fee to perform a credit check, you can request a copy for your records.
When applying for a rental unit, ask about what the application fee entails, request copies of any background checks or credit reports and request a copy of all other application documents for your records.
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