Several landlords have asked, “Should I charge an application fee?” My answer astonishes some. It is simply YES.
Three reasons why:
1. Application fees start the filtering process
If an applicant is unwilling to pay an application fee, you may have a difficult time collecting rent. You are in charge, it is your asset, and you make the rules.
2. Covers your costs
Screening prospective tenants cost you time and money. Recover as much money as possible. If you have to screen 4 tenants to find the right one, it will cost about $100. Don’t go in the hole $100. Collect the application fee upfront.
3. Being consistent on application fees reduces discrimination lawsuits
Charging differing prices and not charging at all on some applicants, opens you up for a lawsuit. Charge a consistent fee. Even if you feel sorry for someone. Please don’t misunderstand me. I am not being cold hearted. Attorneys look for inconsistencies like this to create a discrimination lawsuit.
If you have any questions or comments, please email me.
Sincerely,
Troy Boldt
Renting Authority
888-674-9181
tboldt@RentingAuthority.com
www.RentingAuthority.com
1. Application fees start the filtering process
If an applicant is unwilling to pay an application fee, you may have a difficult time collecting rent. You are in charge, it is your asset, and you make the rules.
2. Covers your costs
Screening prospective tenants cost you time and money. Recover as much money as possible. If you have to screen 4 tenants to find the right one, it will cost about $100. Don’t go in the hole $100. Collect the application fee upfront.
3. Being consistent on application fees reduces discrimination lawsuits
Charging differing prices and not charging at all on some applicants, opens you up for a lawsuit. Charge a consistent fee. Even if you feel sorry for someone. Please don’t misunderstand me. I am not being cold hearted. Attorneys look for inconsistencies like this to create a discrimination lawsuit.
If you have any questions or comments, please email me.
Sincerely,
Troy Boldt
Renting Authority
888-674-9181
tboldt@RentingAuthority.com
www.RentingAuthority.com
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