Michigan Senate Considers Bill to Cap Rental Application Fees at $25

The Michigan Senate is reviewing new legislation aimed at capping rental application fees at $25 and limiting other fees charged by landlords. The proposals seek to address the escalating costs of renting in Michigan and make housing more affordable for residents. If passed, the bills would provide clearer rules on fees, prevent discriminatory practices, and empower tenants with legal recourse.

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Capping Application Fees

Under Senate Bill 372, the Michigan Senate proposes limiting rental application fees to $25. Lawmakers aim to address the growing concern that such fees often exceed $100 and are charged without any guarantee of securing a compatible unit. “Application fees can cost interested renters more than $100, and can be charged without any guarantee that a compatible unit will be available,” explained Senator Rosemary Bayer (D-Beverly Hills).

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Restrictions on Credit Scores

The legislation would also prevent landlords from using a person’s credit score as the sole factor for rejecting a rental application. Senate Bill 372 mandates that landlords notify tenants about the specific criteria for screening, ensuring transparency in the application process. In cases where an application is denied, the landlord must provide the tenant with a copy of the screening report and offer an opportunity to discuss the decision.

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Legal Recourse for Renters

If a landlord violates the provisions of Senate Bill 372, renters would have the right to pursue legal action. Tenants could claim damages up to $1,000 in addition to any costs related to bringing the lawsuit. This new provision aims to provide renters with more leverage against unfair practices and hold landlords accountable.

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Banning “Junk Fees”

Michigan lawmakers are also tackling “junk fees,” hidden charges that can make housing even less affordable. Eric Hufnagel, executive director of the Michigan Coalition Against Homelessness, told the committee that fees like maintenance charges and online payment convenience fees are “arbitrary and unpredictable.” Senate Bill 373 would ban landlords from charging unreasonable fees for services already covered in the rental agreement, such as garbage removal.

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Protecting Tenant Rights

The legislation is part of a broader initiative to safeguard tenants’ rights and foster more equitable housing practices. Hufnagel emphasized that “Renters deserve predictable fair housing costs that are transparent,” as rising rents and hidden fees continue to put pressure on Michigan residents. The statewide average rent has increased by 7.2% as of January 2025, further stressing the need for regulation.

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Eviction and Housing Barriers

Senate Bill 374 aims to address the issue of eviction records, which often prevent renters from securing housing. Senator Bayer highlighted the long-lasting impact an eviction can have on a person’s ability to rent in the future, even when the circumstances surrounding it were beyond their control. Senate Bill 374 would create a process for expunging eviction records under certain conditions, offering individuals a second chance to rebuild their lives.

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The State of Affordable Housing

Michigan continues to face a shortage of affordable housing. As of 2023, over half of renters in Michigan spent more than 30% of their income on housing, a situation that leaves them financially vulnerable. Senate Bill 372 is a direct response to these challenges, aiming to remove financial barriers that prevent many from accessing safe and affordable housing options.