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Pie-in-the-sky listings? Paying rental application fees for an out-of-reach unit

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Mike Moen

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(Minnesota News Connection) Data is scarce, but housing advocates say in a tough rental environment, applicants sometimes fork over screening fees for a unit they stand little chance of getting. That's prompting calls for changes.

Analysts say it's getting harder for people to afford monthly housing costs, including the fees. Assistance groups say over time, people can spend hundreds of dollars on screening fees as they scrounge for housing they might not even get.

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Margaret Kaplan, president of The Housing Justice Center, said its survey reveals in some cases, a landlord encourages a person - who stated they don't meet the requirements - to still apply, in case the other applicants don't work out.

"It just makes a system that is incredibly challenging for potential renters even more challenging," Kaplan said.

The 2021 report her group co-authored found that 90 percent of those surveyed were ultimately rejected in these situations.

Minnesota recently bolstered tenants' rights laws. Kaplan still would like to see more regulations concerning these fees and for Minnesota to follow Rhode Island in heavily restricting them. A group representing landlords did not respond to a request for comment.

The example provided isn't considered a violation.

Mike Vraa, managing attorney for the legal assistance group HOME Line, said it's not surprising similar scenarios are largely anecdotal, because widespread exploitation would draw attention under current law. Vraa agrees Minnesota has been more aggressive in adding renter protections, but still needs to catch up in a few areas.

Another complicating factor is that if an applicant has a complaint about screening fees, it's not likely to draw a huge response.

"This is a low-level crime on its face because the victim is paying [roughly] $50 per time, so it's almost certainly not a felony," Vraa said.

In addition to aid groups, he recommends reaching out to the state Attorney General's Office, because if that staff detects a pattern of clear violations, a robust investigation could follow. Meanwhile, Kaplan said the cumulative effect of application fee barriers can be harmful to low-income applicants.

"People reach a point where a number of things can happen. The first is that people don't have the extra money to be paying all of these application fees. And so, they're going to stay in whatever housing situation that they can find, even if it is really suboptimal," Kaplan explained.