Cal. Civ. Code § 238-A

Limitation on fees

In Force
Verified 9/13/2026 · Next check 9/20/2026
effective 10/17/2025New YorkApplication Fees

Operative Text

Cal. Civ. Code § 238-A
  § 238-a. Limitation on fees. In relation to a residential dwelling
unit:
  1. (a) Except in instances where statutes or regulations provide for a
payment, fee or charge, no landlord, lessor, sub-lessor or grantor may
demand any payment, fee, or charge for the processing, review or
acceptance of an application, or demand any other payment, fee or charge
before or at the beginning of the tenancy, except background checks and
credit checks as provided by paragraph (b) of this subdivision, provided
that this subdivision shall not apply to entrance fees charged by
continuing care retirement communities licensed pursuant to article
forty-six or forty-six-A of the public health law, assisted living
providers licensed pursuant to article forty-six-B of the public health
law, adult care facilities licensed pursuant to article seven of the
social services law, senior residential communities that have submitted
an offering plan to the attorney general, or not-for-profit independent
retirement communities that offer personal emergency response,
housekeeping, transportation and meals to their residents. Nothing in
this paragraph shall prohibit a cooperative housing corporation, other
than a cooperative housing corporation subject to the provisions of
article two, article four, article five or article eleven of the private
housing finance law, from demanding from a prospective tenant any
payment, fee or charge which is necessary to compensate a managing agent
and/or transfer agent for the processing, review or acceptance of such
prospective tenant's application where such prospective tenant would
become a dwelling unit owner or shareholder of such cooperative housing
corporation.
  (b) A landlord, lessor, sub-lessor or grantor may charge a fee or fees
to reimburse costs associated with conducting a background check and
credit check, provided the cumulative fee or fees for such checks is no
more than the actual cost of the background check and credit check or
twenty dollars, whichever is less, and the landlord, lessor, sub-lessor
or grantor shall waive the fee or fees if the potential tenant provides
a copy of a background check or credit check conducted within the past
thirty days. The landlord, lessor, sub-lessor or grantor may not collect
the fee or fees unless the landlord, lessor, sub-lessor or grantor
provides the potential tenant with a copy of the background check or
credit check and the receipt or invoice from the entity conducting the
background check or credit check. Notwithstanding the provisions of this
paragraph, a cooperative housing corporation shall be permitted to
charge a fee or fees to reimburse costs associated with conducting a
background check and credit check in excess of twenty dollars, where the
potential tenant would become a dwelling unit owner or shareholder of
such cooperative housing corporation, provided the cumulative fee or
fees for such checks is no more than the actual cost of such background
check and/or credit check. Further, with regard to a cooperative housing
corporation subject to the provisions of article two, article four,
article five or article eleven of the private housing finance law, all
such fees must be reasonable and approved by the agency supervising such
cooperative housing corporation.
  2. No landlord, lessor, sub-lessor or grantor may demand any payment,
fee, or charge for the late payment of rent unless the payment of rent
has not been made within five days of the date it was due, and such
payment, fee, or charge shall not exceed fifty dollars or five percent
of the monthly rent, whichever is less; provided a cooperative housing
corporation, other than a cooperative housing corporation subject to the
provisions of article two, article four, article five or article eleven
of the private housing finance law, shall be permitted to charge a
tenant that is a dwelling unit owner or shareholder of such cooperative
housing corporation a fee of up to eight percent of the monthly
maintenance fee for the late payment of the monthly maintenance fee if
the proprietary lease or occupancy agreement provides for such fee.
  2-a. (a) No landlord, lessor, sub-lessor or grantor shall demand any
payment, fee, or charge from a tenant for the delivery of a check, draft
or like instrument that was given in payment for rent and subsequently
dishonored by the tenant's financial institution for insufficient funds
except as provided in paragraph (b) of this subdivision.
  (b) Notwithstanding any contrary provision herein, a landlord, lessor,
sub-lessor or grantor may demand any payment, fee, or charge from a
tenant for the delivery of a dishonored check only if such payment, fee,
or charge was provided for in the lease or contract between landlord,
lessor, sub-lessor or grantor and the tenant; provided, however, that:
  (i) such payment, fee, or charge shall not exceed the actual costs,
charges or fees incurred by landlord, lessor, sub-lessor or grantor for
the return of such dishonored check or the amount set forth in
subdivision three of section 5-328 of the general obligations law,
whichever is greater; and
  (ii) if the payment, fee or charge exceeds the amount set forth in
subdivision three of section 5-328 of the general obligations law, the
landlord, lessor, sub-lessor or grantor shall provide to the tenant upon
request evidence substantiating the equivalence between the payment, fee
or charge and the amount of actual costs, charges or fees incurred for
the return of the dishonored check.
  (c) As used in this subdivision, "dishonored check" shall have the
same meaning as such term is defined in section 5-328 of the general
obligations law.
  (d) The provisions of this subdivision shall not apply to a
shareholder of a cooperative housing corporation, provided, however,
that the provisions of this subdivision shall apply with respect to any
tenant or subtenant of such a shareholder.
  3. Any provision of a lease or contract waiving or limiting the
provisions of this section shall be void as against public policy.
Source: Legislative text reproduced verbatim
Plain English

N.Y. Real Prop. Law § 238-A places strict limits on the fees that can be collected in connection with residential tenancies. Before or at the start of a tenancy, landlords generally cannot charge application, processing, or administrative fees, with the only permitted upfront screening costs being background and credit checks capped at the lower of the actual cost or twenty dollars—and even that fee must be waived if the applicant provides a recent check from within the last thirty days. Once a tenancy is underway, late fees cannot be imposed until rent is at least five days overdue and cannot exceed fifty dollars or five percent of monthly rent, whichever is less, and fees for returned checks are tightly regulated and must be grounded in actual costs. Any lease clause that tries to waive or limit these protections is void under the statute.

Written by anthropic/claude-sonnet-4.6 · Reviewed on September 13, 2026

Plain English — not legal advice.

For Property Managers

Operators of residential rental properties subject to N.Y. Real Prop. Law § 238-A generally limit their pre-tenancy collections to background and credit check fees that do not exceed the actual cost or twenty dollars, whichever is lower, and they retain and provide applicants with copies of the check results along with the vendor receipt or invoice. Compliant operators do not assess late fees until rent remains unpaid for more than five days past the due date, and they keep any such fee at or below the statutory ceiling of fifty dollars or five percent of monthly rent. When a returned-check fee is charged, it is authorized by the lease, does not exceed the permitted ceiling, and documentation of actual costs is available to the tenant upon request.

General guidance for property managers — not legal advice for your specific situation. Consult an attorney for advice on your case.

For Tenants

Under N.Y. Real Prop. Law § 238-A, tenants have the right to be free from most upfront fees beyond a narrowly capped screening charge, and they may present a background or credit check obtained within the prior thirty days to have even that fee waived. If a landlord imposes a late fee before the five-day grace period expires or charges an amount above the statutory cap, that charge may be challenged as a violation of § 238-A; tenants can raise such a violation as a defense in a proceeding or file a complaint with a relevant local housing agency or rent board where one exists. Tenant-rights organizations in New York can help residents understand whether a particular fee falls within the exceptions carved out for cooperatives or other specialized housing types covered by the statute.

General guidance for tenants — not legal advice for your specific situation. Consult a tenant-rights organization or attorney for advice on your case.

Generated September 13, 2026 — auto-generated, not yet human-reviewed. See /transparency for methodology.

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Current
Oct 17, 2025
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Related Rules

§ 1950.6

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