What do you do when an applicant applies, you have run credit and they change their mind?
My very strong feeling is that once the application fee is paid, it is nonrefundable. My application states in several places that the application fee is not refundable once it is paid. Be very sure that your application addresses this!
I use a property management system that I use to run credit. Before I run credit, I can refund the application fee but the company is still charged a $5 fee. So even if I was willing to return the fee, it would still cost the company money which I don’t feel is right.
I recently had a situation where someone applied, credit was run and before I could go any further, the applicant called me and said her husband had been transferred to Florida. While I felt bad that they had spent the money on the applications, because there were two, I have a hard time believing that they didn’t have an idea this might be on the horizon. I had already run their credit and did not refund their fee. If you run credit use a different service and just give the applicant the link, you won’t be able to decide whether or not to refund the application fee. I can tell you that it will not be refundable. The application most likely states that as well.
An applicant shouldn’t apply for a property if they feel like it isn’t the right property for them. Just because they change their mind, it should not cost the property owner. For me, there are going to be very few times that I would consider an application fee to be refundable.
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