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Policy&Practice
Innovative solutions to help local policymakers and practitioners
address today’s housing and community development challenges.
July 2023
U.S. Department of Housing and Urban Development | Oce of Policy Development and Research
Transparency in Rental Fees
As part of the housing search, prospective renters
often pay application fees to be considered for
available rental units. Application fees can limit
options for renters and strain household budgets,
particularly for renters with low and modest
incomes who already face high rental cost burdens.
These fees may be particularly burdensome in
tight markets where renters often submit multiple
applications as they compete for scarce units. In
addition, the monthly rent included in a listing may
not reflect the full cost if a landlord later requires
the tenant to pay undisclosed or hidden fees. This
issue of
Policy & Practice provides an overview of
the research on rental fees and highlights strategies
to encourage transparency and fairness in the rental
market.
Research Insights
Most prospective renters contact several owners
or property managers and visit multiple units
during their housing search, even if they ultimately
apply to fewer units. Typically, each application is
accompanied by a rental application fee, which can
range from $50 to several hundred dollars and is
meant to cover the cost of background and credit
checks.
1
A tighter rental market nationally has led to
an increase in the percentage of renters applying to
two or more properties.
2
Application fees are pervasive within the rental
market
3
and contribute to a prerental application
process that disproportionately burdens Black and
Hispanic renters and low-income households with
housing vouchers.
4
Black and Hispanic renters, on
Transparency in renTal Fees | July 2023
average, apply to more units than White renters.
5
In addition to applying to more units, 73 percent of
Black and Hispanic renters and 84 percent of Asian
renters pay an application fee, compared with 56
percent of White renters.
6
Even if prospective renters are charged modest
rental application fees, the fact that most
prospective renters apply to at least one unit
means these costs can add up quickly. Because
tenant screening reports may include inaccurate
information, prospective renters may pay multiple
application fees only to be repeatedly rejected
because of those inaccuracies.
7
Furthermore, after securing housing, renters may
end up paying a monthly amount for their housing
that exceeds the listed price of the unit due to
hidden or junk fees.
8
Tenants are sometimes evicted
when they don’t pay these fees—even if they have
paid their rent. These fees make it harder for renters
to find housing in the future if they are saddled with
debt, an eviction on their record, or diminished
credit scores.
9
Innovative Policies and Practices
Across the country, state and local governments
have placed limits on the amount and types of fees
that can be charged to tenants and now require
increased upfront disclosure of fees that tenants
will be charged. Leasing platforms and housing
providers have also taken action to limit or better
disclose fees. These actions aim to increase
transparency for renters and ensure that fees reflect
the actual costs to housing providers. Although
2
state and local governments play an important
role in regulating fees and promoting fairness,
housing search platforms and housing providers
can voluntarily take proactive steps to increase
transparency in rental transactions. This section
highlights actions that governments and housing
providers can take to increase transparency or limit
rental fees.
Cap or eliminate rental application fees.
Recognizing that application fees often exceed
the costs of screening services, some states have
limited the application fees that landlords can
charge. Several states, such as Virginia, cap rental
application fees at a specific dollar
figure, with caps
typically ranging from $20 to $50.
10
Other states,
such as Washington, set the cap to equal the exact
cost of the tenant screening service.
11
Vermont has
banned rental application fees altogether.
12
Allow prospective renters to provide their own
screening reports. Instead of renters paying
landlords to screen on their behalf, some states
are enabling renters to purchase and provide their
own screening reports. New York State prohibits
landlords from collecting application fees from
prospective renters with portable screening
reports.
13
State laws in California, Maryland, and
Washington define reusable tenant screening
reports, including the contents of those reports
(e.g., income, rental history, credit history, and
criminal history) and the length of time they are
valid.
14
Maryland and Washington require landlords
to disclose whether they accept reusable screening
reports.
15
Those two states prohibit landlords from
charging a fee to an applicant with a portable
report unless the landlord has properly disclosed
that portable reports are not accepted. Similarly,
California prohibits landlords from charging a fee
to an applicant with a portable report unless the
landlord does not generally accept such reports.
16
Allow a single application fee to cover multiple
applications. Similarly, some rental leasing and
property management websites allow renters to
reuse applications and screening reports when
applying to multiple listings on the platform. The
Transparency in renTal Fees | July 2023
online rental platform Avail, which serves mom-and-
pop landlords, allows the 1.3 million renters on its
platform to access their application information and
submit it to multiple property owners at no additional
cost.
17
Zillow oers a universal rental application that
allows renters to apply to unlimited units for 30 days
and includes their credit and background reports.
18
Like the Common App for college applications,
these policies enable prospective renters to apply to
more units at no additional charge.
Limit allowable fees and deposits at the time of
move-in or lease signing. When tenants sign a
lease to move into a unit, they can be charged a
mixture of nonrefundable fees and fully refundable
deposits. State and local governments can set limits
on these fees. For example, the city of Seattle allows
only nonrefundable fees to be charged for cleaning
and screening.
19
Generally, those fees are limited
to less than 10 percent of one month’s rent.
20
In
addition, Seattle’s regulations stipulate that landlords
cannot charge cleaning fees at both the beginning
and end of rental periods,
21
and it forbids landlords
from charging security deposits and fees in excess
of one month’s rent.
22
Several states also specify
that the lease agreement must include the amount,
timeframe, and conditions for late fees.
23
Clearly identify bottom-line amounts that tenants
will pay for move-in and monthly rent.
Advertisements and lease documents can include
language that makes it tough for prospective renters
to identify additional fees that increase their total
monthly costs. These lease document features
should be one page or less in length, in a readable
format, and provided in the languages spoken in
the local area and should clearly identify costs to
renters and the purposes of those costs. The Texas
Apartment Association provides a Summary of Key
Information in their model lease document that
succinctly highlights the total monthly costs and any
additional fees to which renters may be subjected.
24
Connecting to the U.S. Department of Housing
and Urban Development’s Eorts
In January 2023, the Biden-Harris Administration
released a Blueprint for a Renter Bill of Rights, which
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ransparency in renTal Fees | July 2023
3
includes five principles that create a shared baseline
for fairness for renters in the housing market. One
of the principles focuses on clear and fair leases,
highlighting the need for transparency around fees
and security deposits, among other best practices.
25
This brief expands upon a letter that Secretary Fudge
published urging all housing providers, as well as state
and local governments, to take action to limit and
better disclose fees charged to renters in advance of
and during tenancy.
26
Policy & Practice
HUD’s Oce of Policy Development and Research
Aaron Shroyer, Author, Senior Advisor, Oce of Policy
Development and Research
Clarissa Kimmey, Reviewer, Legal Honors Attorney, Oce of
General Counsel
Discuss this issue on the Policy & Practice Forum at www.huduser.
gov/forums. You can subscribe to receive updates from PD&R at
https://www.huduser.gov/portal/subscribe/subscribe.html.
Endnotes
1
National Consumer Law Center (NCLC). 2023. Too Damn
High: How Junk Fees Add to Skyrocketing Rents. Boston, MA:
National Consumer Law Center. https://www.nclc.org/wp-
content/uploads/2023/03/JunkFees-Rpt.pdf.
2
Garcia, Manny. 2022. “Renters of Color Pay Higher Security
Deposits, More Application Fees,” Zillow, April 6. https://www.
zillow.com/research/renters-of-color-higher-fees-30922/.
3
NCLC, 2023.
4
Langowski, Jamie, William Berman, Grace Brittan, Catherine
LaRaia, Jee-Yeon Lehmann, and Judson Woods. 2020.
“Qualified Renters Need Not Apply: Race and Housing Voucher
Discrimination in the Metro Boston Rental Housing Market,”
G J  P L & P 28 (1).
https://ssrn.com/abstract=3705668.
5
Garcia, 2022.
6
Zillow. 2019. Zillow Group Consumer Housing Trends Report.
https://www.zillow.com/report/.
7
Consumer Financial Protection Bureau (CFPB). 2022. “CFPB
Reports Highlight Problems with Tenant Background Checks.”
Press release. Washington, DC: Consumer Financial Protection
Bureau. https://www.consumerfinance.gov/about-us/
newsroom/cfpb-reports-highlight-problems-with-tenant-
background-checks/.
8
NCLC, 2023.
9
National Consumer Law Center (NCLC) and National Housing
Law Project (NHLP). 2022. “Re: Request for Information
Regarding Fees Imposed by Providers of Consumer Financial
Products or Services, Docket No. CFPB-2022-0003,” April 11.
https://www.nclc.org/wp-content/uploads/2022/09/
CFPB_2022_0003_comments.pdf.
10
V. C A. § 55.1-N.Y. R P. L § 238-a(1)(b).
11
W. R. C A. § 59.18.257(1)(b).
12
Dunn, Eric. 2022. “The Case Against Rental Application Fees,”
Georgetown Journal on Poverty Law & Policy (1): 21–47. https://
www.law.georgetown.edu/poverty-journal/wp-content/
uploads/sites/25/2023/01/The-Case-Against-Rental-
Application-Fees.pdf; VT. S. A. . 9, § 4456 (2022).
13
Dunn, 2022; N.Y. R P. L § 238-a(1)(b).
14
C. C. C § 1950.1 MD. C A., R P
§ 8-218; W. R. C A. § 59.18.030.
15
MD. C A., R P § 8-218(c)(1); W. R. C
A. § 59.18.257(1)(a).
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ransparency in renTal Fees | July 2023
4
16
Ludden, Jennifer. 2023. “Rental Application Fees Add Up
Fast in a Tight Market. But Limiting Them Is Tough,” NPR,
January 13. https://www.npr.org/2023/01/13/1148426491/
rental-application-fees-housing-aordable-market-states-
laws; W. R. C A. § 59.18.257(1)(b); Cal. Civ. Code §
1950.1(d).
17
The White House. 2023. “FACT SHEET:Biden-Harris
Administration Announces New Actions to Protect Renters
and Promote Rental Aordability.” Press release. Washington,
DC: The White House briefing room. https://www.whitehouse.
gov/briefing-room/statements-releases/2023/01/25/fact-
sheet-biden-harris-administration-announces-new-actions-to-
protect-renters-and-promote-rental-aordability/.
18
Roberts, Christopher. 2023. “A Rental Market that Works for
Everyone,” Zillow, February 9. https://www.zillowgroup.com/
news/a-rental-market-that-works-for-everyone/.
19
S, W., M. C 7.24.020, 7.24.035.
20
S, W., M. C 7.24.035(B)(4).
21
S, W., M. C 7.24.035(B)(3).
22
City of Seattle. “Move in Costs.” https://www.seattle.gov/
rentinginseattle/renters/moving-in/move-in-costs#:~:text=The
City of Seattle limits,percent of one month’s rent;
S, W., M. C 7.24.035(A).
23
C. R. S. § 38-12-105;770 I. C. S. 95/7.10.
24
Texas Apartment Association. “Apartment Lease Contract.”
https://www.taa.org/wp-content/uploads/2018/01/2017-
Apartment-Lease-Contract-For-Website.pdf.
25
The White House Domestic Policy Council and National
Economic Council. 2023. The White House Blueprint for a
Renters Bill of Rights. https://www.whitehouse.gov/wp-content/
uploads/2023/01/White-House-Blueprint-for-a-Renters-Bill-of-
Rights.pdf.
26
U.S. Department of Housing and Development (HUD). 2023.
Memo from HUD Secretary Marcia L. Fudge. https://www.hud.
gov/sites/dfiles/PA/documents/Junk_Fees_Memo_SOHUD_
signed.pdf.