Tenant screening costs: who pays and what the law allows

Application fees and screening costs are not the same

A screening cost is what a reporting company charges for a credit, eviction or background report. An application fee is what you charge an applicant, which may cover that report and sometimes your time. Some states allow only the actual cost of a check, some cap the total and some ban the fee entirely.

The FTC tells renters to ask what information a landlord uses to decide before paying an application or background check fee. Have that answer ready in your written criteria.

States that bar application fees or allow only the cost of a check

• Massachusetts: at or before the start of a tenancy you may require only first month's rent, last month's rent, a security deposit equal to one month's rent and the cost of a lock and key, and that list has no application fee (Mass. G.L. c. 186, § 15B(1)(b)).
• Vermont: you may not charge anyone a fee to apply to rent a home (9 V.S.A. § 4456a).
• Maine: no fee to submit or review an application, except the actual cost of one background check, credit check or other screening process, and only after telling the applicant they will get a complete copy of the results (14 M.R.S. § 6030-H).
• Rhode Island: no rental application fee. A background or credit check may cost the applicant no more than its actual cost, nothing if they give you one issued within the last 90 days, and you must give them a copy (R.I. Gen. Laws § 34-18-59; R.I. Gen. Laws § 34-18-62).

States that cap the fee

• California: your actual out-of-pocket cost, including the reasonable value of your time, and never more than $30 per applicant, adjusted each year by the Consumer Price Index from January 1, 1998 (Cal. Civ. Code § 1950.6(a), (b)).
• New York: only a background and credit check fee, no more than the actual cost or $20, whichever is less. Waive it for a check done in the past 30 days, and give the applicant a copy of the check and the screening company's receipt (N.Y. Real Prop. Law § 238-a(1)).
• Washington, D.C.: no more than $50, adjustable each year from January 1, 2024 by the Consumer Price Index, and no other fee before the lease is signed (D.C. Code § 42-3505.10(b)).
• New Jersey: since May 1, 2026, no more than $50, except for units in one-family or two-family dwellings and real estate licensees who are not the landlord (N.J.S.A. 46:8-18.1).
• Virginia: a nonrefundable fee of up to $50 plus the actual third-party cost of the checks, or $32 plus those costs for HUD-regulated units (Va. Code § 55.1-1203(A), (C)).
• New Mexico: one screening fee of no more than $50, after written or digital notice and the applicant's written agreement (NMSA 1978 § 47-8-19.2).
• Wisconsin: the actual cost of a credit report from a nationwide agency, up to $25, disclosed in advance, with a copy to the applicant (Wis. Stat. § 704.085(1)(a)).
• Delaware: up to 10 percent of the monthly rent or $50, whichever is greater, with a receipt (25 Del. C. § 5514(d)).

States that regulate the process

• Colorado: spend the fee only on processing, charge every applicant for the same unit the same fee, give a receipt, and make a good-faith effort to refund any unused part within 20 calendar days (C.R.S. § 38-12-903).
• Minnesota: disclose your screening service and criteria first, do not charge when no unit is or soon will be available, and do not cash the fee until earlier applicants have been screened and rejected or have declined (Minn. Stat. § 504B.173).
• Oregon: no more than your average actual cost or the customary amount screening companies charge, and only one charge in any 60-day period (ORS 90.295).
• Washington: give written notice of the information you will use, your criteria and the reporting agency first; you may charge for a report only if you gave that notice (RCW 59.18.257).
• Texas: if you reject an applicant without having made your printed selection criteria available, return the application fee and any application deposit (Tex. Prop. Code § 92.3515).

Refund rules

• Maryland: if fees other than a security deposit total more than $25, keep only what you actually spent on a credit check or other application expenses and return the rest within 15 days after the tenant moves in or either side says in writing that no tenancy will happen (Md. Code, Real Prop. § 8-213).
• New Hampshire: if you do not rent to the applicant, return within 30 days anything beyond the documented cost of the checks and reasonable administrative costs (RSA 540-A:3, VIII).
• Nevada: refund the fee if you rent to someone else without doing what it paid for, and charge nothing for a minor in the applicant's household (NRS 118A.306).

Reusable screening reports

Some states let applicants reuse a recent report. Illinois bars an application screening fee when an applicant provides a qualifying reusable tenant screening report, and caps application fees, including background checks, at $50 for leases signed after January 1, 2027 (765 ILCS 705/30; 765 ILCS 705/35(c)(1)). New York and Rhode Island require a waiver for a recent check, as noted above, and Washington's notice must say whether you accept a comprehensive reusable tenant screening report (RCW 59.18.257).

A fair fee policy in any state

• Write your criteria and fee before you advertise.
• Charge the same fee to every applicant for the same unit.
• Take a fee only when a unit is actually available.
• Give a receipt and keep records of fees and refunds.
• If a report leads you to deny an applicant or require a larger deposit or a cosigner, send an adverse action notice. The FTC says it must name the reporting company and explain the applicant's right to a free copy within 60 days and to dispute errors.

How Rentari helps

Rentari takes online rental applications and orders tenant screening only with the applicant's authorization. It does not decide what your state lets you charge, so set your fee from your state's rule.

Sources and further reading

• FTC: Tenant background checks and your rights
• FTC: Using consumer reports, what landlords need to know
• Mass. G.L. c. 186, § 15B (Massachusetts)
• 9 V.S.A. § 4456a (Vermont)
• Cal. Civ. Code § 1950.6 (California)
• N.Y. Real Prop. Law § 238-a (New York)
• C.R.S. title 38, article 12, part 9 (Colorado)
• Md. Code, Real Prop. § 8-213 (Maryland)
• 765 ILCS 705/30 (Illinois)

Common questions