Step 1: Look at the Application

I want to respond to Rebecca B. Gottesfeld’s Aug. 22 letter regarding my comments about rental application fees.

I said some landlords accept many applications (and fees) from tenants with doubtful credit and pocket the profit. She was “aghast” at that opinion.

She wrote, “How can a landlord possibly know whether the credit worthiness is ‘doubtful’ without the actual credit report?”

Easy, since the tenant fills out the application and turns it in to the landlord before the credit check is run. Any negative information, such as past evictions, bankruptcy, etc., can be reviewed on the spot before the tenant’s application fee is paid.

If the applicant’s credit falls below that landlord’s standards, the landlord could simply reject the application based on the information given so far. No credit check would need to be run, and no fee should be charged.

(It is common practice when mortgage applicants cannot qualify for a loan that the broker will tell them so before they incur loan fees.)

Then she wrote, “How can [the landlord] ‘profit’ after having to pay anywhere from $24 to $30 per credit check?”

Easy again. According to the California Apartment Assn., a full credit check costs only $13, yielding a potential profit of $17 when a $30 application fee is charged.

STEVEN R. KELLMAN

Director

The Tenants Legal Center of San Diego

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Both Rebecca Gottesfeld in her Aug. 22 letter (“Remarks Over Fees Called Inflammatory”) and Steven R. Kellman in his comment about “less than honest” landlords taking multiple rental applications and pocketing the credit check fees missed an opportunity to point out key provisions under the California Civil Code:

* The landlord is permitted to charge “the actual out-of-pocket costs” of the credit check plus “the reasonable value of time spent” obtaining the report, checking references, etc.

* There is a maximum screening fee (used to be $30) that is adjusted annually based on the consumer price index.

* Upon the applicant’s request, the landlord must provide a copy of the credit report obtained. The civil code also requires the landlord to give or mail to the applicant a receipt itemizing the credit check and screening fees.

* Under the law, the landlord is required to refund the entire fee if no check is performed.

As an aside, a landlord is not permitted to charge these fees if there is no vacancy and he or she is simply putting the candidate on a waiting list.

The conscientious landlord will collect credit check fees from only those candidates he is seriously considering.

KEVIN GULBRANDSEN

Thousand Oaks