The following fees and deposits may or may not be charged to residents of affordable rental housing properties. Allowed charges must be reasonable, optional for nonessential services, and clearly documented. Certain fees, such as charges for third‑party verifications, unit transfers, companion animals, or required renter’s insurance, are not permitted under affordable housing program requirements. Property owners/agents should review these standards carefully to maintain full compliance and protect residents from inappropriate or excessive charges.
Note:This is not an exhaustive list. We encourage partners to refer to statute and program rules with respect to projects funded with Elderly and Disable bonds and/or Assisted Living Facilities (ALFs).
Fees and Deposits that are Allowed
- Application fee: Charges must not exceed the actual expected out-of-pocket costs
- Reservation/ Holding Deposit: Permitted only at the time the owner offers a specific unit to an applicant. The applicant must agree in writing to the owner’s written policy regarding reservation/holding deposits.
- Pet deposit: Must be refundable per written guidance.
- Security deposits: Must be refundable per written guidance.
- Early Lease Termination Fee: If the initial term of the lease was at least six months, having a contingency lease break fee does not make a lease transient. This is true even if the tenant breaks the lease sooner than the agreed-upon lease term. Permitted only when a household moves out of the community.
Note: Early Lease Termination fees are NOT allowed when a lease breakage is due to a VAWA request or when the Household is being evicted.
- Coin-Operated Laundry Machines or other Vending Machines: If the area where the machines are is accessible to all residents and the machines are not included in eligible basis.
- Late Rent Fees: May be charged if the terms and rates are explicitly spelled out in writing.
- Service Fees (for example, lockout or key loss): May be charged if the terms and rates are explicitly spelled out in writing.
- Cable (if optional): Non-essential services that are not considered utilities for allowance purposes include cable, telephone, and internet service.
- Air conditioning (if optional): Portable A/C units available to rent
- Fees to Make Rent Payments Online/ Electronically (if optional): Optional fee may not exceed the out-of-pocket cost incurred by the owner; if required must be added to Gross Rent.
Fees and Deposits that are Not Allowed
- Fees to Pay for Third-Party Verifications: Example: Work Number and Banks
- Third-Party Consultant Fees: Fees to review files, approve tenant certifications
- Unit transfer fees
- Service and Companion Animal Deposit, Rents, or Fees
- Required Renter’s Insurance: An owner may suggest that residents secure renter’s insurance but only if the insurance is optional and not a condition of occupancy.
- Monthly pet rent
- Parking, Carport, Garage or Storage Fees (if optional): Only acceptable for LIHTC projects if the parking lot, carport, garage and/or storage units are not included in eligible basis.
- Fees for Preparing a Unit for Occupancy: Owners are responsible for physically maintaining units in a manner suitable for occupancy. However, owners are permitted to charge tenants for tenant-caused damage that is beyond normal wear and tear.
- Community Room or Other Common Area Usage or Rental Fee: Owners may not charge residents/non-residents for use of these if included in the Eligible Basis (EB). A fee may be charged, provided these areas were not included in EB.