Application Fees and Deposits
Disclaimer : The contents of this Article were written by the Austin Tenant's Council. The article is designed for Austin, but has useful information for all Texas residents.
When filling out an application for a rental unit, be sure that the following information is included on the application form:
- How long the landlord has to refund the deposit if the application is rejected
- The unit number of the apartment you are seeking to lease
- The amount of the security deposit
- The move-in date and the length of the lease term
- The names of all people who will live in the unit including all children
- Whether pets are allowed and the amount of the pet deposit
- Whether the landlord pays for any utilities
- Written documentation of any oral promises by the manager or leasing agency such as “the agent will paint the unit prior to move-in” or “the carpet will be cleaned”
- Any other information that will be used to fill out the lease.
Landlords usually request an application fee to compensate the landlord for checking credit reports and processing the application. Typically, application fees are $25 to $35 per person, but there is no limit on what a landlord can charge for an application fee. Application fees are usually nonrefundable (except as noted below).
At the time a prospective tenant is given a rental application, the landlord must also provide written notice of the tenant selection criteria and the grounds for which a rental application may be denied, including an applicant’s:
- Criminal history
- Previous rental history
- Current income
- Credit history
- Failure to provide accurate or complete information on the application form
The landlord should ask the applicant to sign an acknowledgment indicating that notice of the tenant selection criteria was provided. The acknowledgment must include a statement such as “Signing this acknowledgment indicates that you have had the opportunity to review the landlord’s tenant selection criteria. The tenant selection criteria may include factors such as criminal history, credit history, current income, and rental history. If you do not meet the selection criteria, or if you provide inaccurate or incomplete information, your application may be rejected and your application fee will not be refunded.”
The acknowledgment may be part of the rental application if the notice is underlined or in bold print. Any provision in the rental application that purports to waive a right or exempt a party from liability or duty of this notice is void.
If the landlord rejects an applicant without providing the tenant selection criteria, the landlord must return the application fee and any application deposit. The applicant should send the landlord a demand letter by certified mail. The letter should include an address of where to send the application fee and any application deposit and a statement that if the money is not returned within 10 days from the date the landlord receives the letter, the tenant will pursue legal remedies. If an applicant can show the landlord acted in bad faith, the landlord can be held liable for $100, three times the amount wrongfully retained, and reasonable attorney’s fees.
See ATC’s brochure Filing Suit in Small Claims Court for more information.