Tenant background and credit check question

[Steven Sestir]

I saw this in BiggerPockets -Typically, if a tenant applies for a property and fails to qualify – they forfeit their application fee due to the time and cost associated with working their application through. However, if you deny them simply because someone else came first, then you must return their application fee.  

Is this for a background and credit check fees I would have to pay a person back?  Also if you have a couple of could be tenants that check each box on your check list, how would you deny one over the other?  I just want to be safe and I have never have did the application process for a new tenant.  

Any help would be great thank you.

Steven Sestir 

[Ujwal Velagapudi]

I usually consider multiple tenants, take money for each one to pay for background/credit checks, and will not return any funds for rejected applicants. I use rentprep.com so I opt for the feature that allows the landlord to request the applicant to fill out sensitive details online, and they pay for it directly online. Even if I have a couple of applications in that fit the bill but have yet to give me rent + security deposit + signed lease, I will continue to take in new applications. I also don't take partial amounts, it's all or nothing (rent, SD, lease), so there is no misunderstanding or concerns during the process. 

How you reject one over another if they meet your minimum criteria would be whoever has the higher credentials (salary, credit), better referrals from prior landlords, and just a an overall feel for who you think could be a safe, long term tenant who takes care of your property like you would. Little things like promptness, punctuality, good communication, etc. will come into play as well.