HousingLink Blog

Proper Application Fee Procedures

by Josh Dye | Aug 27, 2018

If you collect an application fee, by MN state law you must:

1. Provide your rental criteria in writing.

What income, credit, criminal, and/or rental history requirements must a renter meet to live at your property? Provide this to all potential applicants in writing. Some landlords put this on the back of an application, or hand it to prospective renters on a separate document. 

2. Provide the contact information of the screening company in writing.

If you use a tenant screening company, you must provide their name, adddress, and telephone number to the applicant in writing.

3. Accept or deny applicants on a first come, first served basis.

You cannot collect multiple applications from prospective renters and then choose the best one. You may only accept one application fee at a time, and accept or reject the applicant based on whether or not they meet your rental criteria that was provided in writing.

4. Notify rejected applicants of the criteria they did not meet.

Did you deny an applicant? You must notify them within 14 days the criteria they failed to meet.

5. Refund the application fee if the applicant is denied for any reason not listed in the written screening criteria.

Did you reject the applicant for a reason that was not listed in the criteria you provided in writing? Then you must refund the application fee.

6. Only charge a fee equal to what it costs you to obtain the screening report.

If the screening company charges you $50 for the report, you can charge a $50 application fee. If they charge you $25, you can charge $25. In other words, you may only cover your costs.

7. Provide a written receipt for the application fee.

If a landlord violates this procedure, he or she is liable to the applicant the amount of the screening fee, plus a civil penalty up to $100, civil court filing costs, and reasonable attorney fees incurred to enforce this remedy.

If an applicant provides materially false information on the application or omits material information requested, he is she is liable to the landlord for damages, plus a civil penalty up to $500, civil court filing costs, and reasonable attorney fees.