What is an "application fee"?

An application fee is specifically a fee collected from individuals who are applying to rent a unit. This fee is used to cover the costs associated with processing the rental application, including background and credit checks. By charging an application fee, property management ensures that they are compensated for the administrative work involved in evaluating potential tenants, which may include verifying income, assessing rental history, and conducting reference checks.

This fee is distinct from a security deposit or rent, as it is not applied towards future payments but is instead a one-time charge that helps streamline the application process. Understanding the purpose of the application fee aids leasing professionals in communicating its necessity to prospective renters and justifying the cost as part of the overall rental process.