Legal Question in Real Estate Law in Michigan
Return of Rental Application Fee
I looked at an apartment to rent and the agent said that he required $575 to hold the apartment and to run the credit report. He called it an ''application fee'' but he really said that it was your security deposit. I considered my options and decided against moving in. The agent needed a signed letter from my employer verifying my employment status and information but did not receive it before he ran the credit application. The agent and property management company cashed my check when I left a voice mail with the agent stating I did not wish to rent the property and that he mail me my security deposit check back to me.
They are now claiming it to be an ''application fee'' and that it has been forfeited. Is this legal? I did sign the rental agreement, but it was still pending credit approval/employment verification.
Could $575 be considered an unreasonable application fee?
The agent said that he would give me my check back if I decided against renting, but now he has cashed the check and I am out one month's rent at a location I do not live in and may already be rented out.
I would appreciate the help!
1 Answer from Attorneys
Re: Return of Rental Application Fee
You got ripped off, to put it nicely. What does the application say about an application fee? If you agreed to the fee, and it is stated in the application/agreement, then you have a weaker argument, although it is still extremely excessive. I would immediately send the agent a letter demanding a full refund of your "security deposit" since you did not rent the apartment, and because he said he'd refund it to you (don't say "verbal agreement).
Verbal agreements mean NOTHING and people will say anything to get you to sign an agreement. Next time make sure that the verbal representations match what is in the written document.
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