Landlords often charge a tenant rental application screening fee. These tenant rental application screening fees are legal when handled properly in California.
California Civil Code 1950.6(a) states, in relevant part, “when a landlord or his or her agent receives a request to rent a residential property from an applicant, the landlord or his or her agent may charge that applicant an application screening fee to cover the costs of obtaining information about the applicant.”
There are limits to how much a landlord may charge for the tenant rental application screening fee, however. The screening fee “shall not be greater than the actual out-of-pocket costs of gathering information concerning the applicant, including, but not limited to, the cost of using a tenant screening service or a consumer credit reporting service, and the reasonable value of time spent by the landlord or his or her agent in obtaining information on the applicant.” Civil Code 1950.6(b).
Unless the tenant agrees in writing, “a landlord or his or her agent may not charge an applicant an application screening fee when he or she knows or should have known that no rental unit is available at that time or will be available within a reasonable period of time.” Civil Code 1950.6(c).
Furthermore, the landlord or his or her agent shall provide, personally, or by mail, the applicant with a receipt for the fee paid by the applicant, which receipt shall itemize the out-of-pocket expenses and time spent by the landlord or his or her agent to obtain and process the information about the applicant. If the landlord or his or her agent does not perform a personal reference check or does not obtain a consumer credit report, the landlord or his or her agent shall return any amount of the screening fee that is not used for the purposes authorized by this section to the applicant. If an application screening fee has been paid by the applicant and if requested by the applicant, the landlord or his or her agent shall provide a copy of the consumer credit report to the applicant who is the subject of that report. Civil Code 1950.6 (d)(e)(f).
The tenant application screening fee is not part of the security deposit.
As of 2017, the maximum amount that a landlord may charge for a tenant application screening fee is $47.72. But the amount charged to the tenant must comply with the above provisions. The amount changes yearly, so be sure to check current maximums.
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