There are a few laws that must be followed in Kentucky when you create a rental application for tenants. Failure to comply with these rules could lead to serious legal consequences and allow the tenant to sue.
Application Fee
You can charge as much as you wish as a rental application fee (No Statute). There are no laws in Kentucky providing a set limit, although it is recommended to only charge enough to cover the costs of any background checks. Any amount charged to the tenant is also non-refundable.
Security Deposit
Kentucky doesn't set any limits on how much you can charge as a security deposit (No Statute). However, if you do charge a deposit, Kentucky law (KRS § 383.580) requires that you place the funds in a separate account used only for that purpose and provide the tenant with the account location and number.
Housing Discrimination Law
Kentucky has a specific state law, the Kentucky Fair Housing Act, which mirrors and expands upon federal protections. Under state and federal law, it is illegal to discriminate based on the following characteristics:
- Race and Color
- National Origin
- Religion
- Sex (including Gender Identity and Sexual Orientation)
- Familial status
- Disability
As a consequence, you are not allowed to use these details as a basis for rejection on a KY Rental Application form, nor to include them in the decision-making process.
Notice of Eligibility
You must disclose the screening criteria used during the application process, as well as anything that could lead to a refusal. While the referenced regulation (900 KAR 10:120) specifically pertains to Kentucky Health Benefit Exchange eligibility, general best practices in Kentucky real estate dictate that landlords provide a signature of acknowledgment to prove screening criteria were shared.
Consent Credit Check
Under the Federal Credit Reporting Act (FCRA), tenants being screened in Kentucky must consent to any credit checks you wish to carry out. To make sure you comply with the law, the applicant must provide written acknowledgment of the screening on the application form.