What about Application Fees?

[Steven Chavers]

Hey BP friends! My wife and I are getting ready to put one of our units up for rent for the first time. We are looking into the screening process and realized we could/should charge an application fee. We have reservations because we don't want to charge a bunch of people when only one or a couple are going to be our tenants. But it seems that its expected (my wife and I have never rented). So some questions we have are: At what point do we charge an application fee (charge to fill out the application up front or only when we do credit and background checks)? Cozy allows the tenants to pay for their background and credit checks. Should that be a separate cost from the application fee? I feel like we should be compensated for the amount of time we will spend checking references and processing. How much would be too much in the Chattanooga TN area? Does anyone have any recommendations for companies to use for credit and background checks? Thank you!

[Brian Levredge]

As someone who owns a PM company in Chattanooga, you could easily charge between $40-$50 per applicant.  You should run credit and background on all adults living in a property.  We utilize Propertyware for our management platform and background is run through them.  We pay a fee per applicant to PW for credit and background, plus we incur labor expense for reviewing the info.  We typically won't accept multiple applications on a property (first come first serve) so if we get multiple apps in our system we will refund those without running background once we've approved another application.  Hope that helps.