Opinion: There’s rent, and then there are the extra fees

Fees, fines, and other unexpected charges are increasing the cost of rental housing, making it even harder for low and middle-income renters to stay in their homes.

Last month, the White House unveiled a partnership with Zillow, Apartments.com, and AffordableHousing.com to create more transparency around additional fees that tenants are required to pay — including security deposits, application fees, parking fees, and pet fees — so they can better understand the true cost of rent before signing a lease agreement. This is a step in the right direction to create better protections for tenants and keep more families in their homes. 

In Colorado, including metro areas like Denver, we’ve seen rents skyrocket over the past two years. When you couple that with an often unexpected 20% or 30% in additional non-rent fees, it’s no wonder that Denver County eviction filings reached a five-year high in May. 

As an eviction defense attorney and co-founder of Community Economic Defense Project, a Denver-based nonprofit that rapidly deploys rental assistance and other resources to promote housing stability, I’ve seen how unexpected fees and chargesincrease historically high rents and leave too many Coloradans, including children and seniors, vulnerable to eviction and homelessness. 

Colorado must restore a balance of power between landlords and tenants. A good place to start is holding landlords in Colorado to a higher standard of transparency when requiring tenants to pay additional fees on top of their monthly rent payments.

Currently, landlords across the state have the power to decide when they want to add on a fee and how much that fee will cost the tenant. These fees are rarely explained in lease agreements, if they are included in them at all.

I’ve had tenants show me ledgers that include vague charges such as “bridge risk liability fee,” “lease fulfillment fee,” “convenience fee,” “administration fee,” and “common area maintenance fee.” In many cases, these miscellaneous charges amount to 20% to 30% of a tenant’s total monthly payment to the landlord, usually hundreds of dollars more a month that a tenant must pay on top of their monthly rent.

These fees significantly increase the actual cost of rental housing in a market where half of all renters fear losing their homes because of unsustainably high prices. They keep renters in perpetual uncertainty about how much they’ll owe each month, with many living under the weight of a small, unpaid balance that could be used to evict them at any time.  

Further charges are added to a tenant’s ledger if a rental payment is delayed. A late payment — often the result of an unexpected financial emergency — leads to penalties, service fees,  and, when an eviction notice is placed on a renter’s door, attorney’s fees. These debits can quickly add another $500-700 to a tenant’s ledger balance, making it impossible for them to get back on track.

Some landlords also bill tenants when they receive support from government or nonprofit organizations. If a tenant retains an eviction defense attorney to represent them, the landlord or their attorneys may add additional legal fees to the ledger. If a tenant applies for and receives federal or state rental assistance, their landlord may charge an “emergency rental assistance processing” fee  – penalizing them because a government or nonprofit program sent a check for the full balance owed. And of course, if a tenant is unable to move out at the end of their lease because they can’t find a new place to live, there’s a month to month charge, often adding 10-30% to the original rent.

Aggressive penalties and fees drain emergency rental assistance dollars from federal and state government and community organizations and force agencies to make tough decisions — pay exorbitant ledger fees or risk landing their clients in eviction court.

Non-rent fees charged to tenants should be tied to a landlord’s actual costs and not used as a tool to increase their profits. Lease agreements between a tenant and landlord should be easy to understand, reflect current renter protections under relevant state and local laws, and clearly lay out all chargesupfront.

In support of these changes, state and local governments should take further action to ensure tenants don’t face eviction for late charges, administrative fees, or fines charged by the landlord and work to ensure that courts are enforcing these provisions. 

The partnership between the White House, Zillow, Apartments.com, and AffordableHousing.com is a solid first step to creating more transparency around the non-rent fees that landlords force tenants to pay. It builds on the broader strategy of the White House and Housing and Urban Development Secretary Marcia Fudge to balance the power between tenants and landlords. But we also need state and local officials to do more to address this issue in Colorado and ensure that leases and ledgers are fair and easy to understand. 

Zach Neumann, of Denver, is CEO and co-founder of Community Economic Defense Project.

NOTE: Because of an editing error, an earlier draft of this column was originally published. The draft was removed and the updated version published on Aug. 24, 2023 at 4:41 p.m.