When you submit a rental application, the landlord, property manager or property management company may charge you an application screening fee. In 2009 in California, the landlord may charge up to $42.06, and may use the fee to cover the cost of obtaining information about you, such as checking your personal references and obtaining a credit report on you. (32)
The application fee cannot legally be more than the landlord’s actual out-of-pocket costs, and, in 2009 in California, can never be more than $42.06. The landlord must give you a receipt that itemizes his or her out-of-pocket expenses in obtaining and processing the information about you. The landlord must return any unused portion of the fee (for example, if the landlord does not check your references).
The landlord can’t charge you an application screening fee when the landlord knows or should know that there is no vacancy or that there will be no vacancy within a reasonable time. However, the landlord can charge an application screening fee under these circumstances if you agree to it in writing. (33)
If the landlord obtains your credit report, the landlord must give you a copy of the report if you request it. (34) As explained in the post on “Credit Checks,” it’s a good idea to get a copy of your credit report from the landlord so that you know what’s being reported about you.
Before you pay the application screening fee, ask the landlord the following questions about it:
How long will it take the landlord to get a copy of your credit report?
How long will it take the landlord to review the credit report and decide whether to rent to you?
• is the fee refundable if the credit check takes too long and you’re forced to rent another place?
• If you already have a current copy of your credit report, will the landlord accept it and either reduce the fee or not charge it at all?
If you don’t like the landlord’s policy on application screening fees, you may want to look for another rental unit. If you decide to pay the application screening fee, any agreement regarding a refund should be in writing.
32 Civil Code Section 1950.6. The maximum fee is adjusted each year based on changes in the Consumer Price Index since January 1, 1998.
In 2009, the maximum allowable fee is $42.06. (Issue Insights, California Apartment Association, January 2009).
33 Civil Code Section 1950.6(c).
34 Civil Code Section 1950.6(f).