Application Fees? - Posted by Todd

Posted by Lori Samson on June 06, 2000 at 11:54:47:

At our office (we just moved) we have a drop slot where people dropped off the aps and we usually have 4-6 houses at a time and we take so many calls and quite a few aps. If I see that someone can’t afford a 900 a month but we have a 600 a month we will try to match them to that house. Our job is NOT to get rich on ap fees but they are paying for the process to evaluate them for a house. If you spend the time you charge the fee! I hope that I didn’t come across as trying to take advantage of people because I wouldn’t do that but if I have the service on my computer to run credit checks myself, I would be charged for everyone I run. If I am smart enough to have the same service for free, I don’t feel that I have free aps. When is the last time you have put in an ap at an appartment complex and because you didn’t get the apertment they gave you the ap money back? They charge for the service rather it cost them anything or not. If you are not trying to pull something over on people you should be fine.
If I get a pile of aps in I don’t have a way to know who came in first while I was gone to lunch unless they land in the drop slot in a perfact order.

Application Fees? - Posted by Todd

Posted by Todd on June 05, 2000 at 21:43:09:

How do I handle Application fees…? I received 4 apps for a lease option basically at once. I am checking them all to determine the best tenant for the house. do I not refund any of the application fee?

they signed an app fee form stating non-refundable if they withdraw app, and if rental agreement is not completed the $25 ap fee is non -refundable. if tenant is seleced before app process, then $25 fee refunded to applicant.

so… I paid to run credit checks on everyone so far.
They may have thought it was implied that they get it back if not selected or something.

What to do with $2500 in app. fees… - Posted by Anthony - OH

Posted by Anthony - OH on June 06, 2000 at 09:08:02:

I talked to a landlord a while back who sent his apps off to an independent agency who only “passed” 1-2% of the Apps! He had over 100 apps a month at $25 an app!
He kept every dollar, and had another 100 app fees the following month.

Re: Application Fees? - Posted by Carol

Posted by Carol on June 06, 2000 at 05:22:23:

Gees, didn’t realize I actually agreed with the fair housing act on something! Thanks Eric. We do however, follow the same procedure, and we “date stamp” each app as we take it.

We look it over to be certain it is complete and if it looks like it won’t fly ($900 income for a $550/mo rent , for ex.), we don’t ever send it off for processing, but tell the applicant so up front.

If it looks like it’s reasonably and properly filled out, we pull credit, evaluate, and respond before processing another.

If we receive another app in the meantime, we tell the folks there is one pending and that we will hold theirs (and their $25) until the first is approved or not.

I try to treat the tenants as I would want to be treated, and I would not appreciate spending $25 per potential abode just to be turned down, because someone “better” turned up. If I met the criteria, I would expect to be accepted, wouldn’t you?
Happy renting!

Re: NOW CALLING NUMBER 25! - Posted by Lori Samson

Posted by Lori Samson on June 05, 2000 at 23:51:16:

We take all our aps to a mortgage broker who does our credit checks for free (he values our business we send him). We do charge 25 and if I send over 5 aps on the same house and I see one is more qualified then the other how is anyone going to know what order they came in the door. My husband has a habit of wearing out all the ‘What if’s’ in life. I think you can wear yourself out over this one but sometimes I’m looking over the aps and I don’t even remember what order they were in before I started looking at them if the phone has rang 3 times since I started! Unless you are verbalizing something offesive I can’t see how it can be known unless you have hidden cameras in your office! I don’t! When I find the applicant I like I call the others and say I’m sorry but the house did get leased but if it falls through I will call them back or they can go look at one of our other houses. Give them the address and send them to another house and tell them they can have first shot at it if there aren’t any other aps that have came in yet, but they can go look at it while you check. It’s your business and as long as you are not discriminating because of a true racial issue (for example) then how can anyone know unless you pass out a number when they turn in their ap and are calling the numbers out…" now serving number 25"
I have never had an issue over it. lori

Re: Application Fees? - Posted by eric-fl

Posted by eric-fl on June 05, 2000 at 22:20:04:

Federal Fair Housing laws are very explicit on this. You must process each application, in the order received, on it’s own merits. You should establish an independent scoring system, using your own (legal) criteria - if they pass, they pass, if they fail, they fail. You cannot legally process them all and pick the “best” candidate from the batch. All someone has to do is argue that your definition of “best” violated the fair housing law in some way, and you’re off to court. Therefore, you need to have your own criteria established up front, whatever they are. You cannot discriminate on the basis of race, religion, creed, children, etc. You can discriminate based on income, credit, and interestingly enough, even mode of occupation. Many investors refuse to even accept applications from attorneys, for instance, on the basis that they are litigious. And interestingly, this does not violate the fair housing law. If you do this sort of thing though, again, the criteria must be decided beforehand, and applied to all applicants equally, on a first come, first served basis. You also have a better legal position if you refuse an application from someone you KNOW will not meet your (legal) criteria up front, otherwise taking applications from people knowing in advance they have no chance can also get you in hot water.