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New Law Regarding Application Screening Fee for Prospective Tenants

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Many landlords charge a fee for conducting a credit check on rental applicants. As of January 1, 1999, California law establishes a procedure for these screening fees, and limits the amount of the fee to the landlord's cost in obtaining information, which cannot exceed $30 per applicant. This amount may be increased annually according to the Consumer Price Index. A property manager or landlord can collect this fee only if there is a current vacancy, or if the management knows that the rental will be available soon.

The tenant is entitled to a receipt explaining the charges and, upon request, a copy of the credit report obtained by the landlord. By requesting the copy, a tenant can be sure that the landlord did actually use the screening fee for the authorized purpose. The tenant may submit the report to other landlords, although some landlords may want to do their own credit checks. For more information, please call Office of the District Attorney, Consumer Protection Unit, (408) 792-2880 or Project Sentinel (408) 720-9888.