News & Media
three wood block apartment buildings of different size with rent sign on easel
Andrii Yalanskyi/Getty Images Plus

HUD Wants to Get Rid of Rental ‘Junk Fees’

In an open letter to the housing industry, HUD Sec. Fudge asks members to nix things like application fees, though she also hints at possible legislative changes.

WASHINGTON – U.S. Department of Housing and Urban Development (HUD) Secretary Marcia L. Fudge penned an open letter to the housing industry calling for action on “junk fees” that renters face, part of a larger Biden Administration drive to get rid of junk fees found in a wide range of industries.

In her letter, Fudge says “many renters today face fees that are hidden, duplicative or unnecessary,” and she calls on “housing providers and state and local governments to adopt policies that promote fairness and transparency of fees faced by renters.

Fudge takes special aim at application fees prospective renters must pay to be considered, noting that renters who apply to more than one unit must pay a fee each time. She says “costs can quickly add up to hundreds or even thousands of dollars,” and “renters of color are more likely to be charged.”

She also notes other charges she defines as junk fees in many cases:

  • The cost to correct false information contained in tenant screening reports, which they often can’t access in the first place
  • Move-in fees
  • Late fees
  • High-risk fees or security bonds
  • Convenience fees for online payments

On Wednesday, the White House held a meeting of national and senior statewide leaders to consider junk fees. While the meeting covered all industries, Fudge’s letter says they would also be discussing legislative initiatives.

In the letter, Fudge calls on all housing providers to:

  • Eliminate rental application fees or limit application fees to only actual and legitimate costs
  • Allow a single application fee to cover multiple applications on the same platform or across multiple properties owned by one housing provider
  • Eliminate duplicative, excessive and undisclosed fees at all stages of the leasing process, such as administrative fees and other processing fees in addition
  • Clearly identify bottom-line amounts tenants must pay for move-in and monthly rent in rental property advertisements and lease documents, including all recurring monthly costs and their purpose.

It’s not the White House’s first move to regulate rental fees. Its Blueprint for a Renter Bill of Rights calls for clear and fair leases without hidden or illegal fees and the Resident-Centered Housing Challenge offered a blueprint for interested stakeholders.

© 2023 Florida Realtors®