Everything Renters Need to Know About Rental Application Fees

If you’re deep into your apartment search journey, you’ve probably noticed that landlords and property managers require a fee when you apply. Rental application fees are standard in the leasing process and help landlords cover the costs of screening potential renters. These amounts typically pay for background checks, credit reports, and administrative work, ensuring that applicants meet the necessary requirements before signing the lease.

The amount charged for rental application fees varies widely across the country. In some areas, it might be as low as $25, while in competitive rental markets, fees can reach $75 or more. Some states and cities have placed caps on how much landlords can charge, but in other locations, these costs are left up to the property owner’s discretion. Because application fees can add up, renters should be aware of what they’re paying for and how to avoid unnecessary expenses during their apartment search.

Here’s what you need to know:

Application fees are usually non-refundable

One of the most important things to know is that rental application fees are almost always non-refundable. So, whether or not you get approved, the money you pay for processing the paperwork and running a background check is generally not returned.

Since there’s no guarantee you’ll get the apartment, it’s a good idea to ask the landlord or property manager about their approval criteria before submitting your application. If your credit score or income doesn’t meet their requirements, you may want to avoid paying the fee and look for properties that fit your qualifications.

Application fees vary by location

The cost of rental application fees depends on where you’re renting. In states with high rental demand, application fees tend to be higher. For example, in New York, landlords can only charge up to $20 per applicant for screening costs, while in California, the maximum fee is adjusted annually for inflation and typically falls around $60. However, limitations are not always applied due to ambiguous regulations.

In states without fee caps, landlords may charge significantly more, especially for high-end apartments or competitive listings. So, before applying for multiple apartments, it’s always a good idea to research local laws to understand what a reasonable fee should be in your area. Also, in some cases, the fee can be waived or partially refunded if not used entirely, but this also depends on location.

Some landlords accept third-party screening reports

A growing number of landlords are allowing renters to submit third-party background and credit reports instead of paying a new rental application fee for each apartment they apply to. These services can save renters money, especially if they’re applying for multiple apartments at the same time.

In fact, some states even require landlords to accept third-party reports if they’re recent and meet the necessary screening standards. Therefore, if you’re looking at multiple rentals, it’s worth asking the property manager whether they’ll accept an external report before paying for an application.

You may need to pay a fee for each application

Unless this is your first time looking for rental apartments, you’re likely familiar with the fact that applying for multiple apartments can get expensive because most landlords require a separate application fee for each unit you’re interested in. This is especially true in competitive rental markets, where you may need to pay several application fees before securing an apartment.

One thing you can do to avoid unnecessary costs is to try to narrow down your choices before submitting applications. If possible, talk to the landlord or leasing office to see if they have multiple available units so that you don’t have to pay separate fees for each one. Some property management companies allow one application fee to cover multiple properties in their portfolio, so it’s worth checking before applying.

Application fees can sometimes be applied toward rent

While most rental application fees are non-refundable, some landlords and property managers offer to credit the fee toward your first month’s rent or security deposit if you’re approved. This isn’t a standard practice, but it’s worth asking about, especially if the application fee is on the higher side.

On the other hand, if a landlord doesn’t offer this option upfront, you might be able to negotiate. Some independent landlords are more flexible than large apartment complexes when it comes to refunding or applying fees.

Beware of scams and excessive fees

While most landlords charge reasonable rental application fees, some take advantage of renters by charging excessive amounts or collecting application fees for apartments that aren’t actually available. In popular cities, rental scams are more common, with scammers using fake listings to collect multiple fees before disappearing.

To protect yourself, always verify that the listing is legitimate before paying a fee. If a landlord asks for an unusually high fee or refuses to provide details about the application process, consider it a red flag. Another useful step you can take in your apartment search journey is to research local rental laws to determine whether a fee is within the legal limit.

Pre-qualification can save you money

Some landlords and property managers offer pre-qualification screenings that don’t require an upfront fee. These screenings typically involve a soft credit check, which doesn’t impact your credit score, and help you determine whether you meet the basic requirements before submitting a full application.

So, make sure you check if your landlord provides a prequalification option, as it can be a great way to gauge your chances without wasting money on unnecessary fees. Not all landlords offer this, but it’s worth asking before applying.

While rental application fees are a standard part of the rental process, renters should always be mindful of what they’re paying for. Since these fees are usually non-refundable and can vary significantly depending on location and property management policies, it’s essential to do your research before submitting applications.

You can do this by understanding local laws, asking the right questions, and exploring options like third-party screening reports and pre-qualification. These are great ways to avoid unnecessary expenses and make informed decisions during your apartment search. Whether you’re looking for your first rental or moving to a new city, knowing how rental application fees work can help you save money and secure the best possible home.