In many places, landlords are permitted to charge a fee to cover the cost of running a background check on a potential tenant. This fee, typically paid at the time of application, helps the landlord assess the applicant’s credit history, criminal record, and rental history to make a more informed decision about who to rent to. While the specific amount a landlord can charge for a background check varies, it generally falls within a range established by local or state regulations. It’s important to note that some areas have laws in place to protect tenants from excessive or unfair background check fees.
State and Local Laws on Background Check Fees
The legality of a landlord charging an applicant a fee for a background check varies across the United States. Some states and localities have specific regulations regarding background check fees, while others do not address this issue.
States with Regulations on Background Check Fees
- California: Landlords prohibited from charging an application fee exceeding $50, which must cover all application-related costs, including background checks.
- Illinois: Landlords must disclose in writing any non-refundable fees, including background check costs, before the applicant incurs the charge.
- Maine: Landlords can recoup background check costs only after the applicant is accepted as a tenant and signs the lease or rental agreement.
- Massachusetts: Landlords limited to charging application fees that don’t exceed the cost of the background check.
- Minnesota: Landlords can charge an application fee, but it cannot be more than the landlord’s direct cost for processing the application.
- New Jersey: Landlords must get consent from the applicant before charging a background check fee and must provide a detailed breakdown of the fees.
- New York: Landlords prohibited from charging a fee for a credit check or background check.
- Oregon: Landlords can recoup background check fees only if the applicant is approved for tenancy.
- Rhode Island: Landlords can charge a maximum application fee of $25, which must cover all application-related costs.
- Vermont: Landlords cannot charge an application fee.
- Washington: Landlords are allowed to charge a screening fee, but it cannot exceed $15 and must be used solely to cover the cost of the background check.
States Without Specific Regulations on Background Check Fees
In states without specific laws governing background check fees, landlords may be able to charge a reasonable fee to cover the cost of the check. However, the amount of the fee and the circumstances under which it can be charged are often determined by local laws, regulations, or common practices.
Federal Fair Credit Reporting Act (FCRA)
Landlords who use consumer credit reports in their background checks are subject to the provisions of the FCRA. The FCRA generally prohibits landlords from charging an applicant a fee for a credit report unless:
- The applicant is notified in writing that a credit report will be obtained and that a fee will be charged.
- The applicant provides written consent to the credit check and the fee.
- The landlord uses the information obtained from the credit report only for purposes related to the rental application.
Table of State Laws on Background Check Fees
| State | Key Provisions |
|---|---|
| California | • Maximum application fee of $50, covering all application-related costs. |
| Illinois | • Written disclosure of non-refundable fees required before applicant incurs the charge. |
| Maine | • Reimbursement of background check costs only after applicant is accepted as a tenant. |
| Massachusetts | • Application fees limited to the cost of the background check. |
| Minnesota | • Application fee cannot exceed the landlord’s direct cost for processing the application. |
| New Jersey | • Applicant consent required before charging a background check fee; detailed breakdown of fees must be provided. |
| New York | • Landlords prohibited from charging a fee for a credit check or background check. |
| Oregon | • Reimbursement of background check fees only if the applicant is approved for tenancy. |
| Rhode Island | • Maximum application fee of $25, covering all application-related costs. |
| Vermont | • Landlords cannot charge an application fee. |
| Washington | • Maximum screening fee of $15, used solely to cover the cost of the background check. |
Please note that these are generalizations, and the specific laws and regulations governing background check fees can vary within each state and locality. It is crucial to consult with local authorities or legal professionals for the most up-to-date and accurate information.
Application Fees vs. Background Check Fees
When applying for a rental property, you may encounter two types of fees: application fees and background check fees. It’s important to understand the differences between these fees and when landlords are allowed to charge them.
Application Fees
- Are charged to cover the cost of processing your rental application.
- Typically non-refundable, even if your application is denied.
- Usually range from $25 to $50.
- May be used to cover the cost of credit checks, criminal background checks, and other screening procedures.
Background Check Fees
- Are charged to cover the cost of obtaining a background check on you.
- May be refundable if your application is denied.
- Typically range from $25 to $100.
- May be used to cover the cost of criminal background checks, credit checks, and other screening procedures.
When Can Landlords Charge Fees?
Landlords can charge application fees and background check fees in most states. However, there are some restrictions on when and how these fees can be charged.
- Landlords cannot charge application fees or background check fees that are excessive or unreasonable.
- Landlords cannot charge application fees or background check fees to applicants who are protected by a fair housing law, such as the Fair Housing Act.
- In some states, landlords are prohibited from charging application fees or background check fees to applicants who are applying for low-income housing.
If you have questions about whether a landlord can charge you an application fee or a background check fee, you should contact your local housing authority.
| Application Fees | Background Check Fees | |
|---|---|---|
| Purpose | Cover the cost of processing a rental application. | Cover the cost of obtaining a background check on an applicant. |
| Refundable | Typically non-refundable. | May be refundable if the application is denied. |
| Range | $25 to $50 | $25 to $100 |
| Uses | Credit checks, criminal background checks, and other screening procedures. | Criminal background checks, credit checks, and other screening procedures. |
| Restrictions | Cannot be excessive or unreasonable. | Cannot be charged to applicants protected by fair housing laws. |
Landlord’s Authority to Charge for Background Checks
It’s perfectly legal for landlords to mandate a background check before leasing a property. This practice helps to ensure the safety of both the landlord and prospective tenants and allows landlords to make informed decisions about who to rent to. However, a growing debate exists over whether landlords should charge for these screenings.
Credit Checks
- Credit checks are often used to assess a tenant’s financial responsibility and ability to make timely rent payments.
- Landlords may charge a fee for these credit reports that generally range from $15 to $30.
- In some jurisdictions, landlords are prohibited from charging for credit checks.
- Proponents of charging for credit checks argue that it’s a necessary expense for landlords to ensure they’re not renting to financially irresponsible tenants.
- Opponents argue that this fee disproportionately burdens low-income renters and that landlords should bear the cost of credit checks as a standard cost of doing business.
Criminal Background Checks
- Criminal background checks are used to uncover any past criminal convictions or arrests.
- These checks often entail an additional fee ranging from $10 to $50.
- In some areas, these fees are capped by law.
- Advocates for charging criminal background check fees argue that they’re vital for identifying potentially dangerous or disruptive tenants.
- Critics contend that these fees are discriminatory, as they disproportionately impact minority and low-income applicants.
| State | Fees Permitted | Fees Prohibited |
|---|---|---|
| California | Criminal Background Checks | Credit Checks |
| Florida | Both Credit and Criminal Background Checks | None |
| New York | Criminal Background Checks | Credit Checks |
| Texas | Both Credit and Criminal Background Checks | None |
Ultimately, the legality of charging for background checks varies from state to state. Some states prohibit any fees associated with background checks, while others allow landlords to charge both credit and criminal background check fees. In areas where fees are permitted, their amounts are often capped.
Background Check Disclosure and Consent
When a landlord or property manager conducts a background check on a prospective tenant, they are required to disclose this information to the applicant in writing. This disclosure must be made before the background check is conducted and must include the following information:
- The nature and scope of the background check.
- The types of information that will be collected.
- The sources of the information.
- The length of time the background check will cover.
- The cost of the background check, if any.
- The name, address, and phone number of the consumer reporting agency that will be conducting the background check.
The applicant must also provide written consent to the background check before it can be conducted. This consent must be specific and informed, meaning that the applicant must understand the nature and scope of the background check and the information that will be collected.
In some cases, a landlord may be able to charge a fee for the background check. However, this fee must be reasonable and must be disclosed to the applicant in writing before the background check is conducted. The fee cannot be used to discriminate against the applicant based on race, color, religion, national origin, sex, familial status, or disability.
The following table summarizes the key requirements for background check disclosure and consent:
| Requirement | Description |
|---|---|
| Disclosure | The landlord must disclose the nature, scope, sources, length, cost, and consumer reporting agency of the background check in writing before it is conducted. |
| Consent | The applicant must provide written consent to the background check before it can be conducted. |
| Fee | A landlord may be able to charge a reasonable fee for the background check, but this fee must be disclosed to the applicant in writing before the background check is conducted. |
| Discrimination | The fee cannot be used to discriminate against the applicant based on race, color, religion, national origin, sex, familial status, or disability. |
Hey there folks, thanks for sticking with me on this journey through the ins and outs of background check fees. I know it can be a bit of a dry topic, but I hope you found it informative nonetheless. Remember, the laws and regulations surrounding background checks can vary depending on where you live, so if you have any specific questions, be sure to consult with a local expert.
In the meantime, keep an eye out for more informative and thought-provoking articles coming your way. And if you happen to have any burning questions or topics you’d like me to explore, don’t hesitate to drop me a line. Until next time, keep those brain cells active and those conversations flowing!