Application Fees

socaldisneydudeJanuary 24, 2007

A while back, before moving in to my current apartment, I went to another apartment complex and was interested in one of their units. This place was considerably further away from my job and the rent was cheaper. Before I filled out the application I explained to the manager that my credit wasn't that great but I had never been evicted or had any repossessions or anything major. Just a couple of credit cards that went into collections. I made more than the required triple income to rent ratio also. With all this in mind she told me that I would qualify without any problem because they only tend to watch out for evictions. So I was satisfied and went ahead and filled out the application and forked over my 30 bucks. We would be in touch within 48 hours.

72 hours later I still had yet to receive any call so I called and spoke with the manager. Apparently my credit wasn't good enough so they would require a larger deposit. "How much?" I asked. 1000 dollars plus the first and last months rent in advance so we were looking at 3 thousand dollars to move into this apartment. Needless to say I simply hung up and forgot about that place.

Is it just me or does this not seem right? It seemed to me that the manager found someone better and tried to scare me off with that ridiculous deposit amount. What do you guys think?

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In my state MN anyone renting out an apartment needs to have written qualifiers. This would include a min credit score. I require the deposit when the application is turned in. If their credit or rental references don't meet my minimum they get the deposit back in full. If they have lied about anything I have the option to keep the entire deposit. I ran accross a few people putting down friends as landlords/ boss's.

So I don't really require an application fee if your honest, I feel the $40 to do the background is well worth my money for a good tenant.

I agree, I think your potential landlord found a more desirable tenant, which in my state violates fair housing laws. Applications are to be looked at one at a time. If the first one meets my min they get the place. Even if a single Dr. is #2 and he only plans on staying there one night a month.

It's proably for the better, the $30 might be cheep compared to the miserey of living there and who knows what would have happened to your deposit.

    Bookmark   January 24, 2007 at 9:20PM
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When you have "just a couple of credit cards that went into collections," you probably have seriously damaged your credit rating. Have you ever gotten a FICO score from a credit agency to find out where you rank? It might not be a bad idea.

It's hard to say what happened here, but the landlord may have pulled your credit score and become concerned. First and last month's rent is not uncommon in many complexes, and the $1000 was probably insurance to balance the credit report. In a number of states, it takes a while to evict someone for non-payment of rent, and the landlord is losing money all that time. Since you previously got yourself in a situation where you didn't pay your bills and let it go to collections, it would not be surprising if the landlord concluded there was some risk of the same thing happening with your rent.

    Bookmark   January 26, 2007 at 2:26PM
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"Just a couple of credit cards that went into collections." is very bad. Those couple are not late payment, they are collections, which means you didn't pay and that is major.

The manager said.. but obviously the owners looked at your credit history and said no. Personally I would say no too.

    Bookmark   January 26, 2007 at 7:19PM
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Doesn't necessarily sound to me like they were trying to scare you off (they could have flat out denied you with those couple credit cards then went into collection). Sounds more like they were willing to take you as a tenant as long as there was some extra protection for them to reduce the risk factor. Unpaid credit cards = unpaid bills = unpaid rent in a landlord's eyes. Here in my area, it's standard for nicer apartment complexes to charge first and last month + deposit. I only ask for first month + deposit, because anything more is a huge chunk of change for the average person to come up with. However, I recently increased deposit to 1,000 on any new leases, simply because the cost of materials to repair damage has increased so dramatically, and I got burned one too many times on damages that were not covered by a deposit equivalent to a month's rent. I've had prospective tenant's hang up on me when they hear that, too ;) Or yell at me that it's outrageous. But oh well. If we traded places, they'd no doubt do the same thing.

I would probably decline an applicant who had credit cards go into collection in the last 5 - 10 years. If it happened further back in the past than that, and a good track record was there since, I probably wouldn't have a problem renting to them.

You should keep an eye on your credit, and do what you can to get it cleaned up. Federal law allows one free report per consumer per year. If you go to you can get a report from all 3 bureaus (TransUnion, Equifax and Experion) for no charge. If you want your credit score, I believe you have to purchase that from one of the bureaus. Would encourage you to keep your credit on the straight and narrow from here on out, it will only serve you well in the future.

    Bookmark   January 27, 2007 at 9:48AM
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I'm sorry to hear that. I would not be able to pay the sort of deposit they are asking, nor would I want to. I find it a bit outrageous.

If they worry on the credit, first and last months rent with the standard deposit should do it. The place I'm moving into Thursday is requiring me to pay last months rent as an additional deposit because I do not have prior rental history. I didnt plan on doing that because they never brought up the possibility, nor do I want to, but I dont consider that unfair and can see their reasoning. I would never pay the deposit raised to 1000, with last and first months, though, seems too extreme.

Having bad credit doesn't mean being irresponsible anymore. It used to, I'm sure. Now it's almost impossible to get out of credit obstacles, even when people try for years and do the right thing. I know this from experience. I had a credit card company that screwed me over when I was young, made a deal with them to pay off the card, then they forfieted on the deal and changed the policy three months in. It's a long, boring story, but needless to say I paid them at least 2500 for a 300 limit credit card, and I stopped paying them more. They went bankrupt, thank God, but then sold it to another place that never contacted me and just wrote it off. Now it looks like I have two bad credit marks in my report, when I was only dealing with one that was dishonest. This scenario, among countless others, happens. It's life anymore, which is a shame. I hope you do find a right (and reasonable) place for you, and wish you the best.

    Bookmark   January 28, 2007 at 6:37PM
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Having bad credit doesn't mean being irresponsible anymore.

For the most part, if there's a pattern, it's just plain old bad credit habits and does indicate being irresponsible. But I will agree that odd things happen. I try to take those into account. (Don't look at medical, for instance, because those can be messed up by incompetent billing in a heartbeat. Had seen it happen to family, so I do believe people when they say a medical collection is a snafu they're trying to get worked out.) I did take on a tenant that had a really bad situation on his credit with a local car dealer. He had good credit otherwise. The reason I opted to lease to him was because that local car dealer has a notorious rep for being underhanded, and this guy (young) just got snookered. He was a good tenant and gave me no trouble.

As far as a 1000 deposit, I'm sure that number, when tossed out, seems high. But if rent is 700-850 range, and deposit equals a month's rent, then another 250-300 to meet the 1000 shouldn't kill the deal. I can see how first, last and 1000 deposit could hurt, easily (which is why I only go with first + deposit). Pretty sad really, but deposit had to be bumped up to that level. Another instance of 'bad' tenants ruining it for good ones. It gets so old repairing damage from someone who thought they were a DIYer but weren't, or tempers got out of hand. And a landlord truly has no way of knowing who is going to be 'good' until you get them in there and see how things progress. I've had 'good' tenants on paper that had bad attitudes and anger issues like I've never seen. It was a good day when those lulu's broke their lease & moved out!

    Bookmark   January 30, 2007 at 10:10AM
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