What Is an Application Fee for Rental? [2025 Updated]

As a landlord, understanding how to properly charge and explain the application fee for rental is essential for both compliance and professionalism. In 2025, this fee remains a common part of the tenant screening process, helping to cover the cost of credit checks, background reports, and administrative time. This guide breaks it down so you’re not caught off guard!

What Is a Rental Application Fee?

A rental application fee is a non-refundable charge that landlords or property managers collect from prospective tenants when they apply to rent a property. This fee helps cover the costs associated with screening an applicant, including:

• Background checks
• Credit reports
• Employment verification
• Administrative time (sometimes)

In 2025, application fees for rentals are still common, though they are increasingly regulated by state and local laws. These fees typically range from $25 to $75 per applicant, though in high-demand cities, they can exceed $100. Importantly, paying a rental application fee does not guarantee that you’ll get the rental, only that your application will be reviewed.

Landlords use the fee to evaluate whether a potential tenant meets the financial and behavioral criteria for the lease. However, not all landlords charge the fee, and in many states, there are limits to how much can be charged.

What is an Application Fee for Apartments?

An application fee for apartments is a specific type of rental application fee charged when applying for apartment units (in privately owned buildings, managed communities, or corporate rental complexes).

This fee typically covers the cost of verifying your identity, checking your rental history, confirming employment and income, and reviewing your credit report. Many apartment complexes outsource tenant screening to third-party services, which is one reason fees may vary.

In apartment settings, especially in competitive housing markets, multiple applicants may be screened simultaneously. It’s common for apartment managers to charge each adult applicant separately. In these cases, the application fee for rental may be duplicated across all tenants listed on a single lease.

What is an Application Fee for Renting?

The application fee for renting is a broader term that applies to any rental situation, such as apartments, single-family homes, duplexes, or even rooms in shared housing. Regardless of the property type, this fee is designed to offset the costs of tenant screening, which helps protect the landlord from risk.

In many states, landlords are required to provide receipts or itemized documentation of how the fee was used. Others restrict charging more than what it actually costs to screen the tenant. In some cases, when the landlord never processes your application, you may be entitled to a full refund.

Is the Application Fee for Rental Legal?

Yes, application fee for rental charges are legal in most U.S. states, but they are regulated, and those regulations vary widely. While the fee itself isn’t illegal, what can make it problematic is overcharging, misusing the funds, or charging fees without actually screening the applicant.

Some states (like California, Minnesota, and New York) cap the amount that can be charged, often linking it to the actual cost of a background check. Others require landlords to return unused fees or provide written documentation of how the money was spent.

For example:

• California limits the rental application fee (as of 2025) to a maximum of about $65, adjusted annually for inflation.
• Massachusetts prohibits landlords from charging application fees at all unless licensed as a broker.
• Texas allows landlords to charge, but tenants must be informed of the screening criteria before payment.

All in all, the legal landscape is shifting, especially as housing affordability becomes more politicized. It’s wise for both landlords and tenants to check their local laws or consult legal counsel if unsure.

Who Will Be Obligated to Pay for the Rental Application Fee?

Typically, the person or persons applying to live in the rental property are obligated to pay the rental application fee. This usually involves every adult over the age of 18 who will reside in the unit, regardless of whether they are contributing financially to the rent.

It breaks down as below:

• Primary applicants (the main leaseholders) are always expected to pay.
• Co-signers or guarantors may also be charged if their credit or background needs verification.
• Roommates must often each pay separate fees, even if applying together.
• Married couples are sometimes charged one fee jointly, though that depends on the landlord's policy.

Landlords may choose to waive the fee as a promotion or in special circumstances, but this is rare in competitive markets. It's also worth noting that in subsidized housing or rent-controlled units, application fees may be capped or prohibited entirely.

Therefore, before paying, renters should ask:

• Is this fee refundable if I’m not selected?
• What exactly does this fee cover?
• Will each adult be charged separately?

Getting clear answers up front can save time, frustration, and potentially money!

How Much Is a Rental Application Fee? Typical Costs and Variations

In 2025, the typical rental application fee ranges between $30 and $75 per applicant, but fees in some markets can go well above $100. It’s important to understand what influences the final amount you’re being asked to pay.

The Average Rental Application Fees

Across the U.S., the average rental application fee tends to fall between $40 and $60 per person. This is usually enough to cover the cost of a basic credit report, background check, and administrative review. In many cases, tenants are asked to pay this fee upfront, and it’s usually non-refundable, even if the application is denied or the unit is rented to someone else.

5 Factors That Influence the Fee

So why might your application fee for rental be $45 in one town and $95 in another? Find out the key factors that influence the cost:

• Location and Local Laws: States like California and New York often have caps, while others allow landlords to charge market rates. Some cities also add their own rules on top of state law.
• Property Type: Large apartment complexes that outsource screening to tenant verification services may pass higher costs onto applicants. Smaller landlords may charge less or nothing at all.
• Number of Applicants: If you’re applying with a partner or roommate, many landlords will charge a separate fee for each adult.
• Level of Screening: More thorough checks, especially those involving nationwide criminal databases or landlord reference interviews, can increase costs.
• Market Demand: In high-demand markets, application fees are often higher simply because they can be. It’s legal in most states, but not always renter-friendly.

These charges are some of the key elements that cause a huge rise in moving costs in 2025, and more so during the peak moving season that runs from May to August. In relation to this subject, we were mentioned in a Rent. article. Check out the featured article: Understanding 2025 Moving Costs | Rent. to explore our insights.

State-by-State Guide to Rental Application Fees in the U.S.

Rental application fees are handled very differently across the U.S. Before you pay any application fee for a rental, it’s smart to check your state-specific lease agreement rules!

States with Specific Limits or Restrictions on Application Fee for Rental

While most U.S. states allow landlords broad discretion in setting application fees, several have introduced specific limits, refund requirements, or transparency rules to protect renters.

1. California

California has one of the strictest rental application fee policies in the country. As of 2025, landlords can charge a maximum application fee of approximately $65, but this number is adjusted annually based on the Consumer Price Index. The fee must reflect the actual cost of screening (background checks, credit reports, and administrative time). Additionally, landlords are required to provide receipts for any third-party costs and must return any unused portion of the fee if the screening is not completed. Charging more than the legal limit is considered a violation of California’s Civil Code.

2. Colorado

In Colorado, landlords are permitted to charge an application fee for rental, but the law requires that it reasonably reflect actual expenses incurred during the tenant screening process.

They cannot profit from the application process, and each fee must match the cost of services used, such as credit reports or background checks.

3. Delaware

Delaware sets a clear cap: landlords may charge either 10% of the monthly rent or $50, whichever is greater, as a rental application fee.

This law is designed to scale fairly with the cost of rent, making luxury rentals slightly more expensive to apply for, while keeping fees low for modest units. Landlords must also provide written disclosure of the fee and cannot collect multiple application fees for the same property while still reviewing previous applicants.

4. Maine

In Maine, the application fee for rental is not directly capped, but landlords must follow consumer protection laws that prohibit deceptive practices. This means landlords must clearly disclose what the fee is for and are encouraged (though not required) to keep it in line with actual screening costs.

Though not as strict as other states, Maine places strong emphasis on transparency and fairness in the landlord-tenant relationship.

5. Minnesota

Minnesota offers renters significant protection. Landlords must disclose their screening criteria in writing before collecting an application fee.

If the landlord does not run the background check or uses an outdated report, the application fee must be refunded. This state also discourages landlords from collecting multiple fees if they have already selected a preferred applicant. Failing to follow these rules can result in financial penalties for landlords.

6. New York

Under New York’s rent reform laws, landlords can charge a maximum of $20 as an application fee, and they must provide a copy of the screening report or a receipt from the screening service to justify the charge.

7. Vermont

Vermont doesn’t have a statewide cap on the application fee for rental, but it does expect landlords to adhere to fair consumer practices. Additionally, if the application process is not completed or a screening report is not run, renters may have a case for requesting a refund. Vermont emphasizes clarity and justification rather than a fixed price limit.

8. Virginia

Virginia landlords may charge up to $50 per applicant for a rental application. Landlords are not allowed to profit from application fees, and they must process applications in the order received to avoid taking multiple fees for a single vacancy. For subsidized housing units, the maximum application fee is capped at $32.

9. Washington

Washington State requires landlords to disclose application fees upfront and to only charge what it costs to screen the applicant, according to WA’s Landlord-Tenant laws. They must also inform applicants of the screening criteria before collecting any fee.

If no screening takes place, the fee must be fully refunded.

10. Wisconsin

Wisconsin allows landlords to charge an application fee, but it’s capped at $20 per applicant. Any amount above that is considered illegal unless the landlord can prove that their actual screening costs were higher, and even then, written documentation is required.

How to Collect Rental Application Fees?

Collecting an application fee for rental is a routine part of the tenant screening process. A general guide for landlords to collect rental application fees will be explored in a way that’s professional, transparent, and compliant with state laws.

1. Check local and state laws: Before charging any fee, confirm whether your state or city has:

• A maximum fee cap
• Required disclosures
• Refund rules if no screening is performed
• Prohibited practices (e.g., charging fees without a vacant unit)

1. Communicate the fee: Always disclose the application fee upfront. Let applicants know the exact amount, whether it’s refundable, and what services the fee covers (e.g., credit or background checks).
2. Use a secure payment method: Avoid collecting cash. Instead, use trusted online platforms like LeaseRunner, which let applicants pay securely and provide automatic receipts. This adds professionalism and reduces disputes.
3. Provide a receipt or confirmation: Include the payment amount, date, what it covers, and a basic timeline for review. It adds clarity and avoids misunderstandings.

Pro Tip:  With LeaseRunner, landlords can send out a rental application link for free. The applicant pays the screening costs directly, no charge to you, and it’s fully compliant with state regulations.

Waiving Application Fees: Is It a Good Idea?

Waiving a rental fee means the landlord or property manager chooses not to charge a specific fee that would normally apply during the rental process.

Waiving the application fee for rental can be a powerful marketing tool, but is it the right move for every landlord or property manager?

The waiving of application fees makes sense when: 

• High Vacancy or Off-Season Leasing: If you’re struggling to fill a unit, offering “no application fee” can generate more leads and reduce friction for renters hesitant to pay upfront costs.
• Promotional Periods or Lease Specials: During slow rental months or grand openings, it’s common to waive the fee as a limited-time offer to boost visibility and showings.
• Lower-Risk Tenant Pools: In some markets, a surplus of qualified renters might make screening less risky than renters with records like evictions (which can be disputed in case of inaccuracies!). If you’re confident in applicant quality, skipping the fee may help secure faster commitments.

Final Thoughts

An application fee for rental can be a smart filter for serious applicants. With tenant screening tools from LeaseRunner and transparent fee structures, landlords can screen confidently while building trust from the very start!

FAQs

Q1. Are rental application fees refundable?

It depends on your state laws and whether the screening service was actually used. In many states, if the application fee for rental was collected but the landlord didn’t run a background or credit check, the fee must be refunded. Some states also require partial refunds if the entire amount wasn’t used.

Q2. Are application fees legal?

Yes, application fees for rental are legal in most U.S. states, but many have specific rules or dollar limits. For example, New York caps the fee at $20, while California adjusts its maximum annually. A few states require receipts, written disclosures, or even prohibit fees altogether under certain conditions. Always check your local regulations to stay compliant.