Application fee
A fee prospective tenants pay to cover the landlord's cost of running credit and background checks. Some states cap the amount.
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Part 1 of 4
Why a seller cares
If you rent after selling, the application fee is the first money you pay a landlord, and some states cap it. If you are selling a rental, fees you collected are part of the records a buyer asks about.
Part 2 of 4
A simple example
You apply for an apartment after closing. The landlord charges $45 to run credit and background, which is under your state's cap.
| The situation | What the fee does |
|---|---|
| Renting after your sale | Pays for the landlord's screening; not refundable |
| Selling a rental | A line in the income history the buyer reviews |
| A state with a cap | The landlord cannot charge more than the cap, whatever the form says |
An application fee pays for the screening and nothing else.
Part 3 of 4
What people get wrong
That it is a deposit. It is spent on the check, and it does not come back.
Part 4 of 4 · where to read next
Where it appears in the sale
What a definition is, and what it isn't
Keighbor is a software company, not a law firm, brokerage, or tax adviser. This is general information, not legal, tax, financial, or real estate advice about your sale. Your situation may differ. Before acting on a contract, disclosure, title, tax, or pricing question, ask an appropriately licensed professional in your state.
Written and researched by Keighbor Research · drawn from the reference glossary · how we research and check what we publish
In your Room, this word explains itself where it appears.
Your Room defines application fee in the step you meet it in, beside the document or the date it belongs to. Free to set up, with an agent or on your own.
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