I got an email yesterday from Henni who wanted to know how much money he should spend on securing a no fee apartment. I have discussed the difference between a no fee and a broker fee apartment before, but I thought this would be a good time to explain that a no fee apartment doesn’t mean FREE apartment and that there are costs associated with a no fee rental.
No Fee means No Broker Fee. In other words, if you rent a no fee apartment you are renting an apartment that doesn’t have a broker’s commission attached. Usually there is no broker fee attached because a real estate agent/broker hasn’t assisted you in renting the apartment. However there are some occasions where the owner pays the commission on behalf of the renter as an incentive.
Credit Report Fees: Management companies and landlords run credit checks on each adult on the lease and in some instances, each adult living in the apartment. These fees vary depending on the credit reporting service that they use and on the thoroughness of the report. Some companies simply check your basic credit report for delinquencies and credit scores. Others run a full battery of checks including tenancy court action, employment verification, and even criminal background checks. Management companies have to pay for credit reports whether you end up renting a unit or not, so credit report fees are non-refundable.
Application Fees: This term is sometimes used interchangeably with “credit report fees” but in reality should include both the charges associated with running credit as well as paying for the time that it takes to prepare leases. Application fees are also not refundable.
Holding Deposit: Some landlords require a holding deposit while they run credit checks. A holding deposit is typically between $300 and $500 and is used as an assurance that you are serious about renting the apartment for which you have applied. Since many people put applications on every apartment that they see in an effort to maximize their chances, small landlords who typically stop showing an apartment once an application is accepted, use holding deposits as a security measure to insure that they are only proceeding with someone who is serious.
Holding deposits are typically applied to the actual deposit. So at the lease signing, you would bring a certified check for the first month’s rent and the remainder of the deposit. If your credit comes back and is not acceptable, the landlord will return your holding deposit immediately. If however you are approved and change your mind, holding deposits are non refundable, so make sure that you are serious about the apartment before leaving a holding deposit.
Application fees and credit report checks vary widely, but average between $35 and $75 per adult, for most typical rental buildings. However, fees of $100 to $150 are not unheard of, especially if the management companies run a full background check, which is becoming more common these days. If your unit is very high end or if you are applying for a co-op, fees can be as high as $500. Remember, these fees are non-refundable, so think carefully before you apply.
Tomorrow we will talk about building and unit selection.
No Fee means No Broker Fee. In other words, if you rent a no fee apartment you are renting an apartment that doesn’t have a broker’s commission attached. Usually there is no broker fee attached because a real estate agent/broker hasn’t assisted you in renting the apartment. However there are some occasions where the owner pays the commission on behalf of the renter as an incentive.
Credit Report Fees: Management companies and landlords run credit checks on each adult on the lease and in some instances, each adult living in the apartment. These fees vary depending on the credit reporting service that they use and on the thoroughness of the report. Some companies simply check your basic credit report for delinquencies and credit scores. Others run a full battery of checks including tenancy court action, employment verification, and even criminal background checks. Management companies have to pay for credit reports whether you end up renting a unit or not, so credit report fees are non-refundable.
Application Fees: This term is sometimes used interchangeably with “credit report fees” but in reality should include both the charges associated with running credit as well as paying for the time that it takes to prepare leases. Application fees are also not refundable.
Holding Deposit: Some landlords require a holding deposit while they run credit checks. A holding deposit is typically between $300 and $500 and is used as an assurance that you are serious about renting the apartment for which you have applied. Since many people put applications on every apartment that they see in an effort to maximize their chances, small landlords who typically stop showing an apartment once an application is accepted, use holding deposits as a security measure to insure that they are only proceeding with someone who is serious.
Holding deposits are typically applied to the actual deposit. So at the lease signing, you would bring a certified check for the first month’s rent and the remainder of the deposit. If your credit comes back and is not acceptable, the landlord will return your holding deposit immediately. If however you are approved and change your mind, holding deposits are non refundable, so make sure that you are serious about the apartment before leaving a holding deposit.
Application fees and credit report checks vary widely, but average between $35 and $75 per adult, for most typical rental buildings. However, fees of $100 to $150 are not unheard of, especially if the management companies run a full background check, which is becoming more common these days. If your unit is very high end or if you are applying for a co-op, fees can be as high as $500. Remember, these fees are non-refundable, so think carefully before you apply.
Tomorrow we will talk about building and unit selection.
1 comment:
I am just starting to look. About how many applications is average before you get an apartment?
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