Philadelphia Renters Rights 2025: New Laws Cap Application Fees, Allow Security Deposit Installments

Writer: Joeziel Vazquez 

CEO & Board Certified Credit Consultant (BCCC, CCSC, CCRS) 

17 Years Experience 

Published: December 1, 2025

Philadelphia renters gained significant new protections starting December 3, 2025, as two landmark ordinances took effect addressing the financial barriers that have made moving increasingly unaffordable for the city's 600,000 renting households. The legislation caps rental application fees at $50 or the actual cost of screening, whichever is less, and allows renters to pay security deposits in installments rather than all at once.

These changes represent the most substantial renter protection measures Philadelphia has enacted in years, directly addressing the affordability crisis that has pushed the Philadelphia region into the ranks of the least affordable major metro areas in the country for renters. With nearly half of Philadelphia residents renting their homes and facing rents that have increased dramatically while incomes stagnate, these new laws provide meaningful relief at a critical moment.

As someone who has spent 17 years helping Philadelphia residents navigate complex financial systems and protect their consumer rights, I've witnessed the devastating impact that predatory rental practices can have on families trying to secure stable housing. These new protections are a step toward fairness, but renters must understand their rights and how to enforce them.

Understanding the New Application Fee Cap

The first ordinance, introduced by City Councilmember Rue Landau and signed by Mayor Cherelle L. Parker in September 2025, fundamentally restructures how landlords can charge for rental applications in Philadelphia.

What the Law Prohibits

Starting December 3, 2025, landlords are prohibited from charging rental application fees exceeding $50 or the actual cost of running a background check and credit check, whichever is less. This cap applies within any 12-month period, meaning a landlord cannot circumvent the rule by charging multiple times for the same applicant in a short timeframe.

The legislation goes further by prohibiting landlords from charging application fees at all unless those fees are specifically used to cover the cost of background and credit checks. This eliminates the practice of landlords using application fees as revenue generators rather than cost-recovery mechanisms.

Landlords with multiple available units can charge a prospective tenant only one application fee if that tenant applies for several units with the same landlord. This provision addresses a common practice where renters paid $100 or more per application when trying to secure one of several apartments in the same building or managed by the same property management company.

Credit Check Protections

One of the most important provisions in the application fee legislation involves credit check procedures. Landlords are now prohibited from performing hard pull credit checks that negatively affect a prospective tenant's credit score. Instead, they must use soft pull inquiries that allow them to review creditworthiness without damaging the applicant's credit profile.

This change is significant for several reasons. Hard credit inquiries can reduce your credit score by 5 to 10 points and remain visible on your credit report for two years. When renters apply to multiple properties during a housing search, accumulating several hard inquiries can cause substantial damage to their credit scores, making it even harder to qualify for future rentals, loans, or favorable interest rates.

Under the new law, landlords must also provide tenants with a copy of any credit or background check they perform. This transparency requirement serves multiple purposes. It allows renters to identify and dispute any errors on their reports, ensures landlords actually use the fees for their stated purpose, and creates accountability in the screening process.

For renters who discover errors on the credit or background checks that landlords obtain, understanding your rights under the Fair Credit Reporting Act becomes critical. You have the right to dispute inaccurate information and demand that errors be corrected.

Who Benefits Most From Application Fee Caps

The application fee cap provides the greatest relief to renters who face the steepest barriers to housing, particularly those in communities that have historically experienced discrimination. Black and brown families, immigrants, LGBTQ individuals, and disabled Philadelphians often face higher rejection rates when applying for housing, forcing them to submit more applications and pay more fees before securing a home.

According to data from housing advocacy organizations, the average Philadelphia renter submits applications to five properties before securing housing. At $100 per application, a common charge before the new law, renters paid $500 just for the privilege of applying. For families living paycheck to paycheck or trying to escape unsafe housing, this expense created an insurmountable barrier.

The cap reduces this burden dramatically. Even if a renter must apply to five properties at the maximum $50 fee, the total cost drops to $250, saving families hundreds of dollars that can be used for moving expenses, utility deposits, or furnishing their new home.

Security Deposit Installment Plans

The second major ordinance allows renters to pay security deposits in installments when the deposit exceeds one month's rent, addressing another significant barrier to housing mobility.

How the Installment Plan Works

Under Pennsylvania state law, landlords can charge up to two months' rent as a security deposit, with the charge for the last month's rent included in this calculation. Many Philadelphia landlords require the maximum amount, creating situations where renters must produce three to four months' rent upfront to move into a new apartment when first month's rent is included.

The new law requires certain landlords to allow renters to pay the portion of the security deposit that exceeds one month's rent in equal installments over three months. For example, if a landlord charges a security deposit equal to two months' rent, the renter can pay one month's worth upfront and the additional month's worth in three equal payments over the following three months.

This structure significantly reduces the upfront financial burden. A renter moving into an apartment with $1,200 monthly rent might previously have needed $3,600 upfront (first month plus two months' security deposit). Under the new law, they would pay $2,200 at move-in (first month plus one month security deposit) and then $400 per month for three months to complete the security deposit payment.

Exemptions for Small Landlords

The ordinance includes a notable exemption that limits its scope. Landlords who own only one or two rental units are not required to offer security deposit installment plans. This exemption resulted from pushback by small landlords and some City Council members who argued that requiring installment plans could create financial hardship for individual property owners who rely on full security deposits to cover potential damages.

While this exemption reduces the law's impact, the majority of Philadelphia renters live in buildings with three or more units owned by larger landlords or property management companies. Housing advocates estimate that approximately 70 percent of Philadelphia rental units fall under the installment plan requirement.

Renters should inquire about the number of units their prospective landlord owns to determine whether they are entitled to the installment option. Landlords subject to the requirement cannot legally refuse to offer the payment plan or charge additional fees for providing it.

The Broader Affordability Context

The security deposit installment law addresses a problem that has worsened dramatically in recent years. Philadelphia rents increased by an average of 28 percent between 2019 and 2024, while median household incomes rose by only 11 percent during the same period. This growing gap between rent and income has trapped thousands of families in unsuitable housing situations.

Advocates have documented cases of families remaining in overcrowded apartments with relatives, staying in abusive relationships, or enduring unsafe housing conditions because they could not accumulate the thousands of dollars needed to move. The city's FreshStartPHL program, launched earlier in 2025 to provide move-in assistance equivalent to three months' rent for eligible renters, had to stop accepting applications within months because demand far exceeded available funding.

By allowing renters to spread security deposit costs over time, the new law provides relief without requiring ongoing public funding. It shifts the timing of when landlords receive security deposit funds but does not reduce the total amount they ultimately collect.

How These Laws Protect Your Financial Future

The intersection of rental housing and credit reporting creates significant implications for Philadelphia renters under the new laws. Understanding how these protections affect your credit profile and long-term financial health is essential.

Preventing Credit Damage During Housing Searches

Before the application fee law took effect, renters conducting housing searches could accumulate multiple hard credit inquiries in a short period. Each hard inquiry appears on your credit report and signals to future lenders that you are actively seeking credit, which credit scoring models interpret as increased financial risk.

The prohibition on hard pull credit checks eliminates this damage. Landlords can still review your credit history and scores using soft inquiries, but these do not affect your credit score or appear to other lenders reviewing your report. This protection is particularly valuable for renters who may need to apply for car loans, mortgages, or other credit during or shortly after their housing search.

The requirement that landlords provide copies of credit and background checks they obtain creates an additional layer of protection. Many renters discover errors on their credit reports only when a landlord rejects their application based on incorrect information. With guaranteed access to the reports landlords review, renters can immediately identify and dispute inaccuracies.

According to research from the Federal Trade Commission, approximately 26 percent of consumers have at least one error on their credit reports, and 5 percent have errors serious enough to affect their ability to obtain credit or housing on favorable terms. For renters, these errors can mean the difference between securing housing and facing rejection.

When you discover errors on a credit report that a landlord obtained, you have rights under the FCRA to dispute that information with the credit bureaus. The bureaus must investigate and either verify the information as accurate or remove it from your report. Understanding how credit repair compliance with the Credit Repair Organizations Act works can help you navigate this process effectively or identify legitimate help if you need professional assistance.

Managing Security Deposits Without Damaging Credit

The security deposit installment option provides financial flexibility that can prevent other credit problems. When renters must produce large lump sums for security deposits, many resort to credit cards, personal loans, or payday lenders to cover the cost. These strategies often create new financial problems, including high-interest debt that becomes difficult to repay.

Credit card debt particularly damages credit scores when it pushes credit utilization ratios above 30 percent. If you have a credit card with a $5,000 limit and charge $2,000 for a security deposit, your utilization on that card jumps to 40 percent, which can reduce your credit score by 20 to 50 points depending on your overall credit profile.

By spreading security deposit payments over three months, renters can avoid taking on new debt or depleting savings that serve as emergency funds. This financial stability protects against the credit damage that occurs when unexpected expenses force missed payments on other obligations.

Rental Payment History and Credit Building

While Philadelphia's new laws do not directly address rental payment reporting to credit bureaus, the financial relief they provide creates opportunities for renters to build positive credit histories. When renters save hundreds of dollars on application fees and avoid taking on debt for security deposits, they have more resources to ensure on-time rent payments.

Several services now allow renters to report their on-time rent payments to credit bureaus, which can significantly improve credit scores for individuals with limited credit histories. The financial breathing room these new laws create makes consistent rent payment more achievable, which can translate into credit score improvements of 30 to 60 points over time.

Enforcing Your Rights Under the New Laws

Understanding your rights means little if you cannot effectively enforce them. Philadelphia renters must know how to identify violations and take action when landlords fail to comply with the new protections.

Identifying Application Fee Violations

Common violations of the application fee law include landlords charging more than $50 when the actual cost of screening is lower, imposing application fees without performing credit or background checks, conducting hard pull credit inquiries, refusing to provide copies of credit or background checks, charging multiple application fees when the renter applies for several units with the same landlord, or charging application fees within 12 months of a previous application by the same tenant.

If you encounter any of these practices, document the violation thoroughly. Save all communications with the landlord, retain copies of payment receipts showing application fees charged, request written explanations of what the fees cover, and check your credit report for hard inquiries from the rental application.

Philadelphia's Department of Licenses and Inspections enforces the application fee ordinance. Renters who believe a landlord violated the law can file a complaint with the department, which has authority to investigate and impose penalties. The ordinance allows for penalties of up to $300 per violation, and repeated violations can result in higher fines.

Enforcing Security Deposit Installment Rights

Violations of the security deposit installment law are similarly actionable. If a landlord who owns three or more units refuses to offer an installment plan when the security deposit exceeds one month's rent, or attempts to charge additional fees for providing the installment option, they are violating the ordinance.

Renters facing these violations should first communicate with the landlord in writing, referencing the specific ordinance and requesting compliance. Many violations occur because landlords or property managers are unfamiliar with the new requirements, and education may resolve the issue.

If the landlord refuses to comply, renters can file complaints with the Department of Licenses and Inspections or seek assistance from legal aid organizations. Philadelphia Legal Assistance provides free legal services to low-income residents facing housing issues, and Community Legal Services also handles housing matters for eligible clients.

It's important to note that consumer protection under the Telemarketing Sales Rule extends to situations where companies offer to help renters enforce their rights. Any organization that charges fees for assistance with rental disputes or credit reporting issues must comply with TSR requirements, including waiting periods before charging for services. Be extremely cautious of companies that demand immediate payment for promises to resolve rental or credit issues.

The Broader Movement for Renter Protections

Philadelphia's new laws reflect a growing national movement to address the power imbalance between landlords and tenants in an increasingly unaffordable rental market. Understanding this broader context helps renters recognize additional protections and advocate for further reforms.

National Trends in Renter Protection

Cities across the country have enacted similar protections in recent years as rental affordability has deteriorated. Seattle, Washington, limits security deposits to one month's rent and requires landlords to offer payment plans. Portland, Oregon, caps application fees at the actual cost of screening and prohibits landlords from charging fees to multiple applicants for the same unit.

California implemented statewide security deposit caps in 2024, limiting deposits to one month's rent for unfurnished properties and two months' rent for furnished properties. Several California cities have gone further, requiring landlords to pay interest on security deposits and creating expedited processes for tenants to recover wrongfully withheld deposits.

These policies respond to research showing that upfront rental costs create the largest barrier to housing stability for low and moderate-income families. A 2024 study by the Urban Institute found that 64 percent of extremely low-income renter households could not afford the upfront costs of moving to new housing, even when monthly rent would be affordable.

What Philadelphia Still Needs

While the new laws represent progress, housing advocates argue that Philadelphia renters still face significant challenges that require additional policy responses. Proposed reforms under discussion include requiring landlords to pay interest on security deposits, creating a municipal fund to cover security deposits for low-income renters, implementing stronger enforcement mechanisms with higher penalties for violations, expanding the security deposit installment requirement to all landlords regardless of portfolio size, and establishing a right to counsel for renters facing eviction.

The city's affordability crisis stems partly from a shortage of housing units, which gives landlords significant leverage in setting terms. Mayor Parker's HOME initiative aims to build or preserve 30,000 housing units, which could help ease the shortage and reduce upward pressure on rents. However, the initiative faces funding challenges and implementation has been delayed.

Renters can support further protections by contacting City Council members, participating in public hearings on housing legislation, and joining tenant organizations that advocate for renter rights. United Communities Southeast Philadelphia, Philadelphia Tenants Union, and the Housing Justice Coalition are among the organizations working to strengthen tenant protections.

What This Means for Philadelphia's Communities

The impact of these new renter protections will not be distributed evenly across Philadelphia's diverse communities. Understanding who benefits most and what challenges remain helps contextualize the laws' significance.

Racial Equity and Housing Access

Housing discrimination remains a persistent problem in Philadelphia despite being illegal under federal, state, and local fair housing laws. Black and Latino renters face higher application rejection rates than white renters with identical credit scores and incomes, a pattern documented in numerous fair housing studies.

This discrimination forces renters of color to submit more applications before securing housing, multiplying the cost burden that application fees create. The new fee cap reduces but does not eliminate this inequity. Even at $50 per application, renters forced to apply to ten properties because of discrimination pay $500 in fees.

The security deposit installment provision similarly provides disproportionate benefits to communities of color. Black and Latino families have significantly lower median wealth than white families, making it harder to accumulate the thousands of dollars traditional security deposits require. By spreading costs over time, the law makes housing mobility more accessible to families without substantial savings.

However, the exemption for small landlords may limit benefits in some neighborhoods. Research suggests that smaller landlords are more common in Philadelphia's historically Black and Latino neighborhoods compared to predominantly white areas with more apartment buildings owned by larger property management companies.

Impact on Immigrant Communities

Philadelphia's immigrant communities face unique housing challenges that the new laws partially address. Many immigrants lack established credit histories in the United States, leading to higher application rejection rates. The prohibition on hard credit inquiries protects immigrant renters from accumulating credit damage while they establish their credit profiles.

The requirement that landlords provide copies of credit and background checks helps immigrant renters identify errors that are particularly common in their reports, including confusion between individuals with similar names, incorrect criminal records, and inaccurate information about previous addresses.

Language barriers create additional challenges in enforcing new protections. The city has not yet announced comprehensive language access plans for education about the new laws or complaint processes. Community organizations serving immigrant populations will play a critical role in ensuring these renters understand and can exercise their rights.

Effects on LGBTQ Renters

LGBTQ individuals experience housing discrimination at rates exceeding the general population, with transgender individuals and LGBTQ people of color facing particularly high barriers. Studies show that LGBTQ renters often must submit more applications before securing housing, making application fee caps especially valuable.

The transparency requirements around credit and background checks create additional protections for LGBTQ renters. Discrimination sometimes manifests through subjective application criteria that allow landlords to reject applicants based on bias while claiming other justifications. Required documentation of screening results makes patterns of discrimination more visible and actionable.

Professional Credit Help and Housing Challenges

Rental housing challenges frequently intersect with broader credit issues. Late payments, collections, judgments, and inaccurate reporting can all affect your ability to secure housing, even under the new Philadelphia protections.

At Credlocity, we understand how credit problems create barriers to stable housing. Our team has spent 17 years helping Philadelphia residents and clients nationwide challenge inaccurate credit reporting, including errors that affect rental applications. We've successfully helped over 79,000 clients navigate disputes with credit bureaus and work toward better financial futures.

We operate strictly within the confines of the Credit Repair Organizations Act and the Telemarketing Sales Rule, providing transparent, ethical service that respects your rights as a consumer. Our approach includes a 30-day free trial, a 180-day money-back guarantee, monthly one-on-one consultations, monthly budgeting assistance, and app access so you can track your progress every step of the way.

As a Hispanic-owned business based right here in Philadelphia at 1500 Chestnut Street, we're deeply connected to the communities these new renter protection laws serve. We understand the challenges Philadelphia renters face and how credit issues compound housing barriers. Learn more about our mission and values on our About Us page.

Frequently Asked Questions About Philadelphia Renter Protection Laws

When did Philadelphia's new renter protection laws take effect?

Both the application fee cap ordinance and the security deposit installment ordinance took effect on December 3, 2025. The laws apply to all rental applications and lease agreements entered into on or after this date. Rental agreements signed before December 3, 2025, are governed by the terms agreed upon at that time and are not retroactively affected by the new laws.

What is the maximum application fee a Philadelphia landlord can charge?

Philadelphia landlords can charge no more than $50 or the actual cost of running a background check and credit check, whichever is less. If a background check costs $25 and a credit check costs $15, the landlord can charge no more than $40 total. Landlords cannot charge application fees at all unless those fees are used to cover screening costs. The cap applies within any 12-month period for the same applicant.

Can my landlord perform a hard credit check that affects my credit score?

No. The new Philadelphia law prohibits landlords from performing hard pull credit inquiries that affect your credit score. Landlords must use soft pull inquiries that allow them to review your credit history and scores without damaging your credit profile. If a landlord performs a hard inquiry, this violates the ordinance and you can file a complaint with the Department of Licenses and Inspections.

Am I entitled to see the credit report my landlord pulls?

Yes. Philadelphia landlords must provide you with a copy of any credit check or background check they perform as part of your rental application. This requirement ensures transparency and allows you to identify any errors in the reports that might affect your application. If a landlord refuses to provide copies of screening reports they obtained, this constitutes a violation of the ordinance.

How does the security deposit installment plan work?

If your security deposit exceeds one month's rent, you can pay the amount over one month's rent in equal installments over three months. For example, with a $1,200 monthly rent and a two-month security deposit totaling $2,400, you would pay $1,200 upfront at move-in and then $400 per month for three months. Landlords cannot charge additional fees for offering this payment plan. However, this requirement does not apply to landlords who own only one or two rental units.

What should I do if my landlord refuses to offer a security deposit payment plan?

First, confirm that your landlord owns three or more rental units, as the installment requirement does not apply to smaller landlords. If your landlord is subject to the requirement and refuses to comply, communicate your request in writing and reference the specific ordinance. If the landlord continues to refuse, you can file a complaint with Philadelphia's Department of Licenses and Inspections or seek assistance from legal aid organizations like Philadelphia Legal Assistance or Community Legal Services.

Does the application fee cap apply if I applied to the same apartment within the past year?

Yes, the ordinance prohibits landlords from charging another application fee within 12 months of a previous application by the same tenant. If you applied to an apartment in January 2026 and the unit is available again in June 2026, the landlord cannot charge you another application fee if you apply again. This protection prevents landlords from using repeated application fees as a revenue source.

Can a landlord charge me multiple application fees if I apply for several units they own?

No. If a landlord has multiple units available and you apply for more than one, the landlord can charge only a single application fee. This provision prevents landlords from multiplying application fees when prospective tenants are interested in several apartments in the same building or managed by the same property company. The single fee covers screening for all units you apply for with that landlord.

How do I report a landlord who violates the new renter protection laws?

You can file a complaint with Philadelphia's Department of Licenses and Inspections, which has enforcement authority over both ordinances. Document the violation thoroughly, including saving all communications with the landlord, retaining payment receipts, and keeping copies of any screening reports. The department can investigate complaints and impose penalties up to $300 per violation, with higher fines for repeated violations.

Are landlords required to refund excess application fees charged before December 3, 2025?

The ordinances do not include retroactive refund requirements. Application fees charged before the December 3, 2025 effective date are governed by the laws in effect at that time. However, if you paid an application fee before December 3 and apply to the same landlord again within 12 months after that date, the landlord cannot charge another fee because of the 12-month prohibition in the new law.

What if I have errors on my credit report that landlords are seeing?

You have the right under the Fair Credit Reporting Act to dispute inaccurate information on your credit report. Contact the credit bureaus directly to dispute errors, and they must investigate and either verify the information or remove it from your report. If you need help navigating this process or have complex credit issues, working with ethical credit repair professionals who comply with CROA and TSR can be valuable. Be cautious of companies that promise immediate results or charge fees before providing services, as these are red flags for potential fraud.

Taking Action to Protect Your Housing Rights

Philadelphia's new renter protection laws provide meaningful relief, but they work only when renters understand and exercise their rights. Whether you are currently searching for housing or planning a future move, knowing these protections empowers you to recognize violations and demand compliance.

Start by reviewing any rental applications you are considering to ensure landlords comply with fee caps and credit check restrictions. Ask questions about security deposit payment plans before signing leases, particularly if the upfront costs create financial strain. Keep detailed records of all communications with landlords and property managers, as documentation becomes critical if you need to enforce your rights.

For renters facing credit challenges that affect housing applications, remember that inaccurate credit reporting is not something you must accept. You have the right to dispute errors and work toward better credit health. Understanding your consumer protection rights under federal law is the first step toward overcoming credit barriers to housing.

The intersection of housing stability and financial health runs deep in Philadelphia's communities. These new laws recognize that connection and take steps to reduce the financial barriers that prevent families from securing safe, stable housing. By understanding your rights, enforcing them when necessary, and addressing credit issues that create additional barriers, you can navigate Philadelphia's rental market with greater confidence and success.

---

Important Disclosures

Educational Purposes Only: This article is provided for educational and informational purposes only and should not be construed as legal or financial advice. While we strive to provide accurate and up-to-date information, laws and regulations are subject to change, and individual circumstances vary significantly. Readers should consult with qualified legal or financial professionals for advice specific to their situations.

Not Legal or Financial Advice: The information contained in this article does not constitute legal or financial advice and should not be relied upon as such. Credlocity is not a law firm and does not provide legal services. We are not financial advisors and do not provide financial planning services.

CROA and TSR Compliance: Credlocity Business Group LLC operates strictly within the confines of the Credit Repair Organizations Act (CROA) and the Telemarketing Sales Rule (TSR). We provide credit repair services focused on helping consumers exercise their rights under the Fair Credit Reporting Act to dispute inaccurate, unverifiable, or misleading information on their credit reports.

Consumer Protection Warning: Under the Telemarketing Sales Rule, credit repair companies that sell services over the phone must wait six months before legally charging customers. This is federal law designed to protect consumers from fraudulent operators. Credlocity does not take clients over the phone and only processes enrollments online to ensure full compliance with TSR regulations. Any credit repair company that charges for services immediately after a phone consultation is violating federal law. All consumers are strongly encouraged to report such violations to the Federal Trade Commission at https://reportfraud.ftc.gov/.

Service Disclaimer: Credlocity provides credit repair services that involve analyzing credit reports, identifying potential inaccuracies or unverifiable items, and assisting consumers in exercising their rights to dispute such items under the FCRA. We cannot guarantee specific outcomes or credit score increases, as results depend on numerous factors including the accuracy of information being disputed and the responses of credit bureaus and furnishers. We do not and cannot remove accurate, verifiable negative information from credit reports.

Local Service Commitment: While this article focuses on Philadelphia-specific renter protections, Credlocity serves clients in all 50 states. Our Philadelphia location at 1500 Chestnut Street, Suite 2, allows us to understand the unique challenges facing local renters while providing services to consumers nationwide. We offer a 30-day free trial, 180-day money-back guarantee, monthly one-on-one consultations, monthly budgeting assistance included in all plans, and app access for real-time tracking.

For more information about consumer protection laws that govern credit repair services, visit our comprehensive guides on the Credit Repair Organizations Act and TSR compliance.

About the Author

Joeziel Vazquez is the CEO and founder of Credlocity Business Group LLC, with 17 years of experience helping consumers navigate credit systems and exercise their consumer protection rights. As a Board Certified Credit Consultant (BCCC, CCSC, CCRS) and FCRA Certified Professional based in Philadelphia, Joeziel has dedicated his career to educating consumers about their rights under federal and local laws. After becoming a victim of credit repair fraud in 2008, he founded Credlocity as an ethical alternative committed to transparency, compliance, and real results. His investigative journalism since 2019 has exposed predatory practices in the credit repair industry and advocated for stronger consumer protections in both credit and housing markets.