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Old 03-01-2009, 07:34 AM
 
2,672 posts, read 3,756,919 times
Reputation: 2523
Angry Credit Check Fees

Almost all landlords require a credit check fee that is supposed to cover the cost of a prospective tenantís credit history. I have been a long time homeowner and two years ago decided to sell my home and move to a townhouse.
(FYI, I have a very good credit rating). I was shocked to see the fees that I was charged, pet fees and a credit check fee. My problem with credit check fees is that I usually buy new cars and I have yet to be charged for a credit check. A car dealer will let me leave with a $40k vehicle on my signature, but I must pay a fee to rent a town house for $1000 a month. Secondly, anyone can run a credit check on anybody for the low price of $19.95. Why is it then that some landlords charge $25, $35, $50, and even $100 for a credit check?
I pay for a credit watch service that alerts me whenever there is something odd about my credit or there is an inquiry such as a credit check. After paying a rental agent my credit check fee I asked for a copy of that credit report. (Yes, I do get a credit report with my credit service). The rental manager told me that her company was not in the practice of providing that information to the tenant and that I had no right to see it. I paid the fee and according to her received an acceptable rating. A month past and I did not get a notice from my credit service and so I called them. They informed me there had been no inquiries for more than a year. I confronted the rental manager with this and she said they used other means. To the best of my knowledge there is only three credit reporting agencies. It was very obvious that this ďcredit check feeĒ at this complex was a rip off.
For those of you who may have some credit problems in the past this practice of collecting fees and pocketing the money can work for you. I suggest that when you apply for an apartment and a credit check fee is required; tell the manager/agent that you want a copy of your credit report. If they tell you they donít do that it is a pretty good bet that they are going to pocket money. However, that is still no guarantee they will not check.
For those of us who have good credit and are tired of paying fantasy fees I think it is time to contact of respective politicians and complain, complain, and complain some more. Renters are customers yet are treated like second-class citizens because they choose to rent. If rated, most landlords would have the worst customer ratings of any business. Is it any wonder that many tenants have no respect for their property? If we sit by and do nothing we can look forward to a laundry list of felonious fees. To sit by and do nothing is an indication that we donít mind paying these fees. Who knows, landlords may even begin to install coin slots on the toilets if weíre not careful? Donít get mad, get even.

Don
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Old 03-01-2009, 07:48 AM
 
15,385 posts, read 19,863,664 times
Reputation: 6435
I have so far never charged for the background check but did tell potential renters I will charge if they want to fill out an application form and their background doesn't check out well...most people already start to tell what was in their past ....one person did tell me a fake eviction story...well she was evicted but not from the address she claimed but she had a big judgment against her for not paying rent, damaging the place, etc...I did found out without paying a penny and didn't charge them...I was glad not to deal with them anymore and the public records over here are very helpful as a first background place...later I will charge if I think i need to and if the background checks out as they have filled out and told me and they sign the lease, I don't charge them....

You have to understand that paying for the background check makes people already start to tell about their past.
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Old 03-01-2009, 08:03 AM
 
850 posts, read 2,725,849 times
Reputation: 631
First of all, it's typically not just a "credit check fee" it's an "application fee". There are usually many parts to processing an application in the apartment industry. You have a credit check, income and employment verification, criminal background checks and rental and mortgage history checks. So a $25-$50 application fee will go to cover the costs of all of these things.

Secondly, as far as showing the person a copy of the credit report, that is not something most landlords are able to do. Most large companies don't pull the report directly from the credit reporting company, they go through a rental screening company. I'm not sure of the exact laws or reasons behind it, but I know with every rental screening company I ever used, everyone who pulled credit reports in the office had to sign something agreeing they wouldn't show the credit report to the applicant. So it's a very common practice in the industry that you can't see a copy of the report.

Finally, many large management companies use third party tenant screening companies as I mentioned above to process their applicants. The leasing staff will submit the information to the company and the company will process the application and then give the community an acceptance or denial. The community never sees any information and doesn't know what is pulled. All they have is an apporval or denial.

So perhaps instead of thinking the greedy rental industry is out to get you and everyone else who is renting, maybe think that there are lots of factors that go into running a community and processing applicants than you know about. While yes, landlords to want to make a dollar or two and there are some exuberant fees out there, there are also legitimate fees and this happens to be one of them.

And back to the point I made in my response to my other posts to you....it's the landlord's property to do whatever they want with. They can screen their tenants however they'd like and they can charge whatever fees they'd like. If you don't like it, you don't have to live there. Most renters are grateful that they have a place to live and will be happy to do whatever that property owner requests. They respect the fact that someone has been generous to share THEIR property with them. The awful, disrespectful tenants you mention aren't that way because they have to pay fees, they're that way because they have NO respect for other people's property and opinions. Landlords don't make bad tenants, disrespectful people make bad tenants.
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Old 03-01-2009, 08:04 AM
 
Location: Boca Raton
9,342 posts, read 15,993,414 times
Reputation: 9029
I use a company that charges $35 and that is what I charge. But it includes credit and other background- criminal, verify drivers license, etc. Recently approved someone for a rental that had terrible credit, but an excellent payment record with his current landlord. He got in trouble, lost a house and is jumping through hoops to make sure that he pays everything on time.

OTOH, had one come back with invalid social and drivers license, no credit history even though he stated that he has operated his own business for five years.

With so many available rentals, I think that I would try to get the landlord to agree to a refund of the fee if the check comes back clean. Would, IMO, be a good way to start out a year+ long relationship.
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Old 03-01-2009, 08:20 AM
 
Location: mass
2,905 posts, read 4,440,398 times
Reputation: 4879
Quote:
Originally Posted by Babytarheelz View Post
First of all, it's typically not just a "credit check fee" it's an "application fee". There are usually many parts to processing an application in the apartment industry. You have a credit check, income and employment verification, criminal background checks and rental and mortgage history checks. So a $25-$50 application fee will go to cover the costs of all of these things.
Just curious as to why you assume the OP misrepresented what the fee was?

I certainly have paid a credit check fee to an apartment that had nothing to do with an application fee.

Other times there was no credit check fee, only an application fee.

As to his questioning why the credit check fee is higher than it costs to get the credit check done, well for one thing, someone has to contact the credit bureau, review the credit report, draw conclusions, etc.... This takes time and therefore money. These tasks don't complete themselves
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Old 03-01-2009, 10:08 AM
 
850 posts, read 2,725,849 times
Reputation: 631
Quote:
Originally Posted by mommytotwo View Post
Just curious as to why you assume the OP misrepresented what the fee was?

I certainly have paid a credit check fee to an apartment that had nothing to do with an application fee.
Because that's a standard apartment industry fee. I'm referring to large management companies where my experience lies. I've been in the industry for a long time, have gone through industry related education to earn designations and am a member of our local and the National Apartment Association. From my experience, the fee is almost always an "application fee." The only time I've ever seen just a "credit check fee" is with small management companies and private landlords. Of course there are always exceptions to every rule, but this is the case with every management company I know of (and I know of alot).
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Old 03-01-2009, 11:56 AM
 
812 posts, read 1,580,051 times
Reputation: 449
it's the administrative fees as well as charging an application fee for EVERY person over 18. so a couple could be charged 100 just to fill out an application and that doesn't include other 'administrative' fees they've dreamed up. i think it's a ripoff. it's best to ask them ahead of time what their detailed requirements are if you have some past rental issues. some places have different criteria.

just like the 35 dollar overdraft fees at banks. only takes 5 dollars to process. but then again, that's even more understandable to encourage a positive and closer inspection of your balace.

it is not true that they have to charge you a fee for an application or even a credit check at all. i've applied at very good apartment complexes and some avant-garde where 0 application fees or administrative fees were policy.

Last edited by leaana; 03-01-2009 at 12:07 PM..
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Old 03-01-2009, 01:08 PM
 
850 posts, read 2,725,849 times
Reputation: 631
Quote:
Originally Posted by leaana View Post
it's the administrative fees as well as charging an application fee for EVERY person over 18. so a couple could be charged 100 just to fill out an application and that doesn't include other 'administrative' fees they've dreamed up. i think it's a ripoff.
Typically, married couples only have to pay one application fee. When their information is processed through a tenant screening company, the community is usually charged the individual rate. Not always true, but the most common scenario.

The administrative fee (aka redecoration fee, reservation fee, amenity fee) is per apartment, no matter how many people live there. This is another one of those "junk" fees (which I agree are a ripoff!). They're in place for a few reasons. First, it's extra income, which communities are always trying to increase. Secondly, it's become such a standard that everyone does it, so it's deemed acceptable by most renters and no one has a problem paying it. And finally, it's another way communities can offer an incentive to potential renters without it affecting their bottom line. If they waive an admin fee, they're not out anything since it wasn't going towards anything, whereas if they reduce rent, they're losing money. So when business is good, they usually charge full fees, but when business is slow, you'll often see them waived.

Quote:
it is not true that they have to charge you a fee for an application or even a credit check at all. i've applied at very good apartment complexes and some avant-garde where 0 application fees or administrative fees were policy.
Probably what happened is in my note above. Most communities have a set fee structure and admin fees are almost always included. I'd venture to guess that yours happened to be waived when you moved in.
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Old 03-01-2009, 06:38 PM
 
13,504 posts, read 24,628,462 times
Reputation: 7789
I've never charged a credit check fee or application fee in over 25 years in the rental business.

Most of my turnovers are by word of mouth so I'm not looking at a large volume of applications. I also review each applicant personally and pay the $11 fee for the basic check myself.

It would be different if I had to pay staff to meet with perspective tenants...

In CA, it is legit to pass along the actual cost of a credit check and staff time. The idea is the charge shouldn't be more than cost and never charge for a fee under the guise of a credit check and then fail to perform it.
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Old 03-02-2009, 10:02 AM
 
Location: Up in the air
19,127 posts, read 14,092,448 times
Reputation: 15727
I've spent over $200 in the past 2 weeks on 'credit/application' fees for houses. 3 of them were for property management companies, so at least those applications stay on file for 6 months... but the others ones... well, I never even got a courtesy callback. After spending $25+ on an application fee, I'd at least expect a callback telling me we werent' selected to rent the house.
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