Is agreeing to rental terms considered a binding verbal contract?

[Nina B.]

A Father came to look at our rental for his newly graduated college son. I gave the Father a Rental Application as well as an Oregon Rental Application Addendum & Fee Disclosure. The Father dropped of both signed agreements (by his son) two days later with a $50 non-refundable processing fee. During the approval process the son called me and asked if I would make some term adjustments on the Fee Disclosure. I agreed to a pro-rate of 1st months rent and a reduced early lease termination fee. In my mind this oral agreement was only "upon approval." The son however (young) felt that our agreement on terms translated to his approval and said as much to his parents. The parents are livid and telling me I have an oral binding contract with there son and threatening to call an attorney! At no time did I ever tell the son he was approved and I still actually have his $50 un-cashed check. Now we so scared we want to take the unit off the market. A friend suggested mailing check back with no comment?  I'm in the State of Oregon.