If you are charging application fees for your rental property in California, you are required by law to have written rental criteria in place. Many landlords are surprised to learn that collecting an application fee without clear, documented standards can create legal exposure.
For rental owners in Pleasanton, Livermore, Dublin, Castro Valley, and San Ramon, strong rental criteria do more than satisfy California Civil Code §1950.6. They protect you from Fair Housing claims, improve tenant quality, and create a consistent, professional leasing process.
Key Takeaways
California Civil Code §1950.6 requires written rental criteria when charging application fees.
Rental criteria should outline income, credit, background, and rental history standards.
Criteria must be provided to all prospective tenants before collecting application fees.
Screening standards must be applied objectively and consistently.
Clear rental criteria reduce legal risk and improve leasing outcomes.
What California Law Requires Under Civil Code §1950.6
California Civil Code §1950.6 governs application screening fees. If you charge an application fee, you must:
Only charge up to the maximum allowable amount set by law
Use the fee solely for actual screening costs
Provide a receipt if requested
Have a written screening process in place
The law is designed to prevent landlords from collecting excessive or unjustified application fees. One of the most important components is having documented rental criteria that explain how applicants will be evaluated.
Without written criteria, it becomes difficult to justify why one applicant was approved and another was denied. That lack of documentation can create problems in the event of a dispute or Fair Housing complaint.
What Should Be Included in Written Rental Criteria
Your rental criteria should clearly outline the standards applicants must meet. While the specifics may vary depending on the property and rental price in Pleasanton or San Ramon, most compliant criteria include the following categories.
Income Requirements
State your minimum income threshold, often expressed as a multiple of monthly rent. For example, requiring gross monthly income of three times the rent is common.
Be consistent. If your criteria state three times the rent, apply that standard uniformly to all applicants.
Credit Standards
Specify how credit will be evaluated. This may include:
Minimum credit score expectations
Review of past delinquencies
Bankruptcy considerations
Collections or charge-offs
Avoid vague language such as “good credit required.” Instead, define measurable standards that can be applied objectively.
Rental History
Outline what you consider acceptable rental history. This may include:
No prior evictions within a defined timeframe
Positive landlord references
No outstanding rental debt
Document how far back you review rental history and what types of issues may result in denial.
Background Screening
California places restrictions on how criminal history may be used in rental decisions. Blanket bans on anyone with a criminal record can create Fair Housing concerns.
If you conduct background checks, your criteria should:
Comply with current California regulations
Focus on relevant convictions
Avoid overly broad exclusions
Laws in our area change frequently, so staying current is essential.
Occupancy Standards
Clearly define maximum occupancy limits that comply with state and local regulations. Overly restrictive occupancy rules can raise discrimination concerns, particularly related to familial status.
Why You Must Provide Criteria to All Prospective Tenants
It is not enough to simply have written rental criteria. You must also provide it to all prospective tenants before collecting application fees.
This transparency accomplishes several things:
Reduces misunderstandings
Discourages unqualified applicants
Demonstrates fairness
Strengthens your legal position if a denial is challenged
In competitive markets like Dublin and Castro Valley, providing written criteria upfront builds trust with applicants and signals that you operate professionally.
If one applicant receives criteria and another does not, you create unnecessary legal risk. Consistency protects you.
Apply the Criteria Objectively and Consistently
Having written criteria is only the first step. You must apply it objectively and without exception.
Common mistakes rental owners make include:
Approving a marginal applicant because they “seem nice”
Making exceptions for friends or referrals
Changing standards mid-process
Delaying approval to wait for a stronger applicant
These inconsistencies can lead to Fair Housing complaints, particularly if a denied applicant believes they were treated differently due to a protected characteristic.
The safest practice is to process applications in the order received and approve the first applicant who fully meets your written criteria. If you deny an applicant, document exactly which standard was not met.
Consistency creates defensibility.
How Strong Rental Criteria Improve Leasing Outcomes
Beyond legal compliance, strong rental criteria improve business results.
For rental owners in Pleasanton, Livermore, and surrounding areas, well-defined standards:
Reduce vacancy time by filtering out unqualified prospects early
Improve rent collection reliability
Reduce eviction risk
Set professional expectations from the beginning
Clear standards also make your leasing process more efficient. When applicants understand income requirements, credit expectations, and documentation needs upfront, the approval timeline shortens.
In a competitive East Bay rental market, efficiency matters.
Frequently Asked Questions about Rental Criteria in California
Do I have to provide rental criteria before accepting an application fee?
Yes. If you charge an application screening fee, California law requires that you have written criteria and apply a defined screening process.
Can I change my rental criteria after I start marketing the property?
Changing criteria mid-process creates risk and may appear discriminatory. Criteria should be established before marketing and applied consistently.
What is the maximum application fee I can charge in California?
The maximum allowable screening fee is set by California law and adjusted periodically. The fee must reflect your actual screening costs.
Can I deny someone based solely on a low credit score?
You may deny an applicant if they do not meet your written credit standards, provided those standards are applied consistently and comply with Fair Housing laws.
Clear Rental Criteria Protect You and Your Investment
Rental criteria are not just a formality. They are a legal safeguard and a business tool. In California’s highly regulated environment, informal screening practices create unnecessary exposure.
For rental owners in Pleasanton, Livermore, Dublin, Castro Valley, and San Ramon, the combination of written standards, consistent application, and full compliance with Civil Code §1950.6 is essential.
At Advantage Property Management Services, we help property owners create legally compliant rental criteria, implement consistent screening procedures, and stay current with California landlord-tenant regulations.
If you need help building or refining your rental criteria, visit https://www.propertymanagementpleasanton.com/rental-criteria or contact Advantage Property Management Services today to ensure your leasing process is both compliant and effective.
Additional Resources
Trip Hazards in Rental Properties: California Landlord Responsibilities and Liability Risks
The 2026 California Landlord Law Update: A Practical Guide for Rental Owners
What Every California Landlord Should Know About Security Deposits
