Rental Application Fees: What the Fee Covers, What the Law Allows, and Renting Without One

A rental application fee is the charge some landlords ask for before they review an application. Whether you charge a fee for a rental application, how much, and whether you can at all depends on what it pays for and on your state. This guide covers all three, and the case for renting without one.

What the fee usually pays for

When a landlord charges an application fee, it is usually to cover a screening report: a credit report, a background check, or both, bought from a screening company for each applicant. Some landlords also treat it as payment for their time reviewing applications. Who keeps the money depends on the setup. Sometimes it passes straight to the screening company, sometimes the landlord or the listing platform keeps part of it.

For the renter it is a cost per application, not per home. Someone who applies for five places pays five times, and gets a unit at most once.

This is general information, not legal advice.

Where fees are banned or capped

Some states and cities limit what a landlord may charge an applicant, and the rules differ a lot. One example, from the text of the law itself:

In New York, Real Property Law section 238-a says a landlord may not charge a fee for processing, reviewing or accepting an application. It allows a fee for a background and credit check of no more than the actual cost or twenty dollars, whichever is less, and requires the landlord to waive it if the applicant provides a check done within the past thirty days (New York State Senate, Real Property Law section 238-a, checked September 2026).

That is one state. Before you charge anything, look up the current rule for your state, and for your city, on an official source: your state legislature's website or your state attorney general's tenant guide. Lists of "fees by state" on landlord blogs go out of date, and we are not going to add another one.

What you give up without a fee

Be honest about this. If you do not charge a fee and you still want a credit or background report on every applicant, you pay for every report. The usual alternative is to drop the per-applicant report, or to buy one only at the end.

The other thing a fee does is filter. A fee makes casual applicants think twice. Without one, you may get more applications, including some from people who were never likely to qualify. The fix for that is clear criteria up front, not a charge.

What you can still ask for

Not charging a fee does not mean not checking. You can ask every applicant for the same documents:

• Photo ID, to confirm who they are
• Proof of income: recent pay stubs, an offer letter, or bank statements
• A reference: a current or previous landlord, and how to reach them
• An employer contact, if you want to confirm employment

Then do the checking yourself: call the previous landlord, compare the income to the rent, confirm the ID matches the application. It takes time. It is also the part a screening report does not do for you anyway.

Questions that save both sides time

Put the deal-breakers on the listing and in the first questions of the application, so people who do not fit find out before they apply:

• Move-in date, and whether it is flexible
• Lease length they want
• Pets, and what kind
• Whether they can meet the income requirement you apply to every applicant (for example, a stated multiple of the rent)
• Number of vehicles, if parking is limited

Ask about income, not where it comes from. Ask the same questions of everyone, and keep them to the unit, the rent and the lease. Nothing about age, family, religion, origin, health or anything else about who the person is. Check the fair housing rules that apply where you rent.

If you do screen later: only the finalist

A middle path: take applications at no charge, narrow them down with documents and references, and pay for a screening report yourself only for the person you intend to offer the lease to. You pay for one report instead of making every applicant pay for one each.

If you go this way, tell applicants at the start that you may run a credit or background check on the finalist, get their written permission before you do, and follow the rules for what you must tell someone if a report leads you to say no.

How it reads to applicants

A listing that says "No application fee, and we'll tell you either way" reads very differently from one that asks for money before the first reply. Renters who have paid fee after fee notice. It tells them you are going to read the application, not just run a report on it.

Say it plainly in the listing and on the application page:

"There is no fee to apply. We ask for ID, proof of income and one landlord reference. We may run a credit check on the applicant we offer the lease to, with their permission, at our cost."

Where Loftfolio fits

Loftfolio charges applicants nothing. There is no application fee and no screening fee, because Loftfolio has no screening product. That is the reason, not a promotion.

What it does have: every application made on your site becomes one record with a status, notes and a message thread, and you can ask an applicant for photo ID, proof of income or a reference, which they upload to their application. That is a request and an upload. Loftfolio does not check credit, run background checks or verify documents; reading them is still your job. Inquiries from portals, email or phone are not in the pipeline until the person applies on your site, so reply with the listing's link.

If you like the no-fee approach but want somewhere to put the applications, see how Loftfolio works for landlords. For the application process itself, how to automate rental applications, and what to keep manual.

→ Loftfolio for landlords