Landlord Question and Answer Forum

Hi, I have my house listed for rent and there are 3 people that have put in applications and paid the $50 application fee for married couples. The 3rd couple was approved credit wise, but wanted to set up a time to come out again and make a final decision, and before signing a lease, they wanted the carpets re-cleaned and thought the AC was too old and should be replaced. In the mean time, someone else saw the house and put down a holding deposit, but until the lease is signed I am still showing the property. Now the 3rd couple was called today and asked if they wanted to come see the house again and was informed that a partial deposit was made. They are livid and threatening to sue for fraud because they paid an application fee and quote, "how dare you take a deposit when our application was approved, we paid an application fee why was another application even taken, i feel already taken by fraud". I need to send them a letter but cant find one that suits this. Please let me know if what I am doing is wrong and what I can do

Hi, most property managers ask for for credit checks as I do and the prospective tenants should know from the begining that this is a nonrefundable fee. So unless they have a valid Lease Agreement signed by you and them I don't think they have a leg to stand on. Most likely they are just trying to intimadate you into changing your mind. Don't that's a red flag - don't consider them as tenants. Try calling a property management and see if someone would consider answering "what if questions" without giving them a lot of personal info. Also check out Landlord/tenants rights via internet and see your rights in the state you are renting in. Check out lease applications fees and see what your state says. I would think that as long as the propective tenant knows or if it is written on the application - this too should be nonrefundable. Good Luck! I hope this helps you.

Posted by Mary J, CA on Thursday, June 28, 2012

I agree with Mary J, CA. Double check that the application states the app fee is non-refundable. Then, keep records on the credit report and make notes on the applicants you are considering, include date, time, question, outcome. There are some limitations on what you may charge in an application fee according to the state Landlord/Tenant Law. It's good to check your states "Landlord/Tenant Law" on the internet like Mary J. suggested. I think it is fine to continue showing your property and accepting applications with the $50.00 charge - as long as you have not selected an applicant as your new tenant based on the credit report outcome plus the other factors involved in your choosing: job status, income verification, references, etc. You may use other factors, like these, not just the credit report. Just make sure you are equal in your assesement of each applicant. And keep good records. The letter you prepare should be a form-style that goes out to each prospective applicant stating the factors that were considered (i.e. job length and verification, income verification, references, etc.). Be careful not to go into factors that are deemed illegal against the Fair Housing Act: (look it up for specific details) but they include, of course, race, gender, but also number of children, number of family members, age, etc. Finally, I signed up for the Legal Zooms Business Plus program (around 240.00$ for one year) to be able to have 30 min. consultations with regard to my rental property (as an LLC). It may be an option if you are really concerned. Hope this helps. Good Luck.

Posted by Christof and Marie M, CA on Thursday, June 28, 2012

No they have not signed a lease agreement! The Landlord/Tenant rights say nothing but dont discriminate against sex, race, color, etc. And states that you can charge any application fee you wish. The guy asked me before he filled out the application if it was refundable and I said NO! He asked if the pet fee was refundable and I said NO! he has a bankruptcy on his credit report, but my Property Manager told him that it was approved due to the length of time, but he would have to pay 1 1/2 security deposit. well he feels that since he has a security clearance with the military he shouldnt have to pay a security deposit at all. I used the application on this website and it doesnt state whether or not its refundable. I dont know what to put in the denial letter as to why I am denying him as a tenant....or do I just simply write a letter stating that the property was leased to someone else? even though that is lying and would be worried that he might see it still listed for rent.

Posted by patricia s, NC on Thursday, June 28, 2012