State seeks to lower application fees for apartment searching

Latasha Webb

University junior Brandon Bass spent about $100 in application fees this summer while looking for an apartment.

Applying for four apartments was difficult, he said, but the security deposit and the first month’s rent for the apartment he plans to share with five to six friends cost him the most.

“I spent about $4,000 getting into (the apartment),” he said.

Although it was more expensive than he hoped, Bass said after spending months searching for an apartment near campus with at least three bedrooms, he knew he had better take it.

Keith Torma, a student at the Art Institute of Minnesota, said he spent about $150 on application fees and $1800 on first month’s rent and security deposit.

Application fees can cost $25 to $75 per unit. Landlords use the money to check prospective tenants’ backgrounds and credit. Applying to only five apartments can cost $100 to $375 – a full paycheck for many college students.

“(Security deposits and application fees) are both problems for people,” said Gerry Kaluzny, an attorney for Southern Minnesota Regional Legal Services. “What they do is make it very expensive to look for apartments.”

The University has approximately 50,000 students and 5,000 residence hall rooms. With a majority of students living off-campus, the Twin Cities’ housing crisis can force students to accept sub-par conditions.

Due to tight competition for affordable units, some students settle for apartments priced higher than anticipated, meaning higher bills, possibly more loan debt, postponed graduation and more working hours.

The number of students searching for housing outnumbers available units. Students could spends hundreds of dollars on application fees and never get a place.

Housing advocates at the State Capitol agree there is a problem with the application fee system.

Last session, housing advocates encouraged legislators to change housing laws so tenants could purchase a credit and background report themselves. Apartment searchers could provide landlords with their report for up to 45 days.

This would allow renters to pay only one application fee.

The measure didn’t pass, but a bill co-authored by Rep. Joe Mullery, DFL-Minneapolis, was passed, creating a committee to study the application fee process. The committee will report its findings to the Legislature by Jan. 1.

“Some people spend more than a month’s rent trying to get into an apartment. It’s really hard on people,” said Rep. Karen Clark, DFL-Minneapolis, another co-author of the bill.

Mullery said he suspected many landlords pocket the fee instead of using it for credit and background checks.

Clark said she supported the bill to allow tenants to purchase their credit report, but the majority of House Republicans were against it.

While legislators wait on the committee’s report, a Minnetonka- based company helps metro area apartment seekers and allows them to purchase their credit report.

Rental History Reports runs Zero Wait, which is allied with 700 metro area apartment complexes. Tenants can purchase a screening report and give them to landlords from any of the 700 complexes within 30 days.

Landlords not affiliated with Zero Wait do not have to accept thereports.

“Now a renter has a choice,” said Tony Karels, a manager at Zero Wait.

Karels said Zero Wait supports voluntary alliances like theirs, but landlords should be able to pick their own screening company and charge the application fee if they choose.

“We advocate for the renter and the owner,” said Karels. “We try to work with both sides.”

“(Getting into an apartment) can take months and cost thousands of dollars,” said Clark. “It’s a serious problem.”

 

Latasha Webb welcomes comments at [email protected]