A nation is not housed until all its citizens are housed.— Franklin D. Roosevelt
For years, rental application fees have always been a limiting factor for renters. After all, when they’re too high, it makes it hard for people to secure housing in some areas. And for a long time, it has been something renters have complained about but still paid for anyway. However, that is changing with the new Philadelphia application fee law.
Recently, the city officially capped rental application fees at $50 or the actual screening cost, whichever is lower. And while tenants see this as financial relief, many landlords are now trying to figure out what this means for the screening process. Let’s talk about it in more detail.
Main Takeaways
- Philadelphia now limits rental application fees to $50 or the actual screening cost, whichever is lower.
- Landlords can only charge fees tied directly to background or credit checks.
- The law aims to reduce upfront rental costs for tenants applying to multiple properties.
What Is the New Application Fee Law in Philadelphia?
The Philadelphia application fee law is part of the city’s broader “Move-In Affordability Plan,” which focuses on reducing upfront rental costs for tenants. Under this law, landlords and property managers in Philadelphia, like BMG, can no longer have an open-ended application fee.
Understandably, this may seem like a challenge, since you typically set the fee based on how you conduct your leasing process and the estimated cost. However, you need to understand what this new law proposes.
This is what it looks like:
- Rental application fees are now capped at $50.
- However, if the actual screening cost is lower than $50, landlords can only charge the lower amount.
And the law goes beyond just putting a cap on fees.
You can now only charge application fees that are directly connected to tenant screening costs. This includes background checks, credit checks and other fees related to the application process. If no screening report is being run, landlords generally cannot charge an application fee solely because the $50 cap exists.
In some cases, you may also need to provide applicants with copies of the screening reports used during the process.
This law officially took effect in December 2025 and now applies to new rental applications across Philadelphia. That said, why did the city put that $50 cap? Let’s look at that next.
Why Did the City Cap Rental Application Fees?
The city’s reasoning behind the cap was straightforward. Rental application fees were starting to feel like yet another financial hurdle for tenants trying to find housing.
In competitive rental markets, tenants rarely apply to just one property anymore. Most of them apply to several listings at once simply to improve their chances of getting approved. The issue is that every application usually comes with another fee attached to it.
So after a while, those costs start piling up. Some renters were spending hundreds of dollars on applications alone and still walking away without securing a place to live.
Philadelphia officials also argued that, in some situations, landlords and leasing companies were charging more than the actual cost of running screening reports. And that became a major part of the conversation surrounding the new law.
Also, this has been a national conversation and not left to Philly alone. Housing affordability has become a much bigger discussion across the country, and rental fees are now getting more attention than they did a few years ago.
And as expected, many landlords pushed back on the proposal as well. Their concern was not necessarily about screening tenants. Their apprehension was whether stricter limits would make it harder to recover legitimate screening expenses, especially now that compliance responsibilities keep growing.
How This Law Affects Landlords Financially
Let’s now see how this affects you financially. Of course, one major conversation is how it impacts the screening process, but how else does it do it? Let’s find out in a table below:
What Changed for Landlords? |
What It Means in Practice |
| Application fees must reflect actual screening costs | Landlords can no longer add inflated processing or administrative fees on top of screening reports. |
| Repeated application charges are now limited | In certain situations, local laws may limit repeated application fees for the same applicant under the same ownership or management. |
| Screening systems may need adjustments | Property owners managing several units may now need better tracking systems to stay compliant with the law. |
| Tenant screening still carries real costs | Credit checks, lawful screening reports, identity verification, and compliance procedures still cost money for landlords. |
| Compliance is now part of the screening process | The focus is no longer just on collecting application fees. Landlords now have to balance proper tenant screening with Philadelphia’s updated rules. |
So, landlords must screen tenants carefully, but now they also need to make sure every part of the process aligns with the city’s requirements.
What Landlords Can Still Charge Legally
The law does not completely ban application-related fees; it simply places a cap on them. So you can still charge for credit checks, criminal background checks, and screening reports, if applicable. But remember, the fee must remain tied to the actual screening cost and cannot exceed $50 total.
Landlords also still have the right to carefully screen applicants. The law changes the fee structure, not the importance of tenant screening itself.
That distinction matters because screening remains one of the most important parts of protecting a rental property financially. Poor screening decisions can create much larger losses later through unpaid rent, lease violations, or property damage.
So while the Philadelphia application fee law limits how fees are collected, it does not remove the need for careful tenant evaluation.
How Tenants Benefit From the $50 Cap
For tenants, the biggest benefit is usually reduced upfront cost pressure. But there is more they are gaining from this new Philadelphia application fee law.
Let’s look at it in a table below:
Tenant Benefit |
What Changes Under the Law |
| Lower application costs | Rental application fees can no longer go above $50 or the actual screening cost, whichever is lower. |
| Less pressure when applying to multiple rentals | Renters applying to several properties at once may spend less money during the housing search process. |
| More transparency | Applicants have the right to know what the application fee actually covers. |
| Access to screening reports | In many cases, tenants must receive copies of the background or credit reports used during screening. |
| Protection from inflated fees | Landlords cannot add excessive processing or administrative charges unrelated to screening costs. |
| Fairer application process | The law creates more predictable and consistent application costs across Philadelphia rentals. |
| Screening still applies | Landlords can still review income, credit history, rental background, and other qualification standards before approving a tenant. |
Stay Compliant While Protecting Your Rental Investment
Rental laws in Philadelphia continue to change, and small compliance mistakes can become expensive for landlords. From application fee limits to screening requirements and leasing regulations, it’s becoming more important to have a process that protects both your property and your business.
At Bay Property Management Group, we help Philadelphia landlords stay up to date on local rental laws while maintaining strong tenant screening standards. We help you stay compliant from marketing and leasing to compliance support and day-to-day management. Our team works to help you protect your rental income without losing sight of the bigger picture.
