Rental Application and Tenant-Screening Fee Requirements in Montana
At a glance
| Governing law and coverage | Mont. Code Ann. § 37-56-109; statutory property manager of 4+ dwelling units, with property manager broadly defined by § 37-56-101(2) |
|---|---|
| Fees allowed or prohibited | Application fee recognized; for unsuccessful applicant, manager may retain only written-notice allocations for specific services actually performed (§ 37-56-109(1)-(2)) |
| Maximum charge and adjustment | No numeric, per-applicant, per-household, or indexed ceiling; unsuccessful-applicant retention limited to out-of-pocket service costs, excluding manager time/effort (§ 37-56-109(2), (4)(b)) |
| Permitted costs and charge timing | Cost means out-of-pocket expense for a specific pre-approval/disapproval service, including but not limited to credit check; no manager-time/effort charge; refund rule applies if no qualifying rental agreement (§ 37-56-109(1), (4)(b)) |
| Before-screening disclosures | At fee collection, written notice must allocate portions of total fee to each specific service cost; no unit-availability, screening-criteria, report-source, dispute-right, or application-order disclosure (§ 37-56-109(2)) |
| Receipt, report copy, and refund | If no signed or legally equivalent rental agreement, refund within reasonable time, less disclosed costs for services actually performed; no special receipt or screening-report-copy duty (§ 37-56-109(1)-(2)) |
| Applicant-supplied or reusable reports | No statewide applicant-supplied or reusable screening-report acceptance or no-fee procedure |
| Application order and adverse action | No statewide first-in-order, first-qualified, single-application, or state denial-reason notice process for rental applications |
| Remedies and stronger local rules | Wrongfully withheld amount recoverable as damages; court may award prevailing-party attorney fees; manager bears proof of application services rendered; no local-preemption/stronger-local-law clause (§ 37-56-109(3)) |
A refund rule for covered property managers
Montana Code Annotated § 37-56-109 applies when a statutory property manager of four or more dwelling units requires an application fee before renting a dwelling unit. Section 37-56-101(2) broadly defines property-management activity to include procuring tenants, showing rentals, acting between owners and potential tenants, and representing that the individual performs those tasks.
If the applicant does not become a party to a signed rental agreement, the manager must return the fee within a reasonable period. The same rule applies when no unsigned agreement gains equivalent legal effect under § 70-24-204 through acceptance of rent, possession, and payment in the circumstances that section describes.
Written allocation and costs actually incurred
If the fee includes specific service costs, § 37-56-109(2) requires written notice at collection showing the portion of the total fee allocated to each cost. For an applicant who does not enter the qualifying rental agreement, the manager may retain only a cost that:
- appeared in that written allocation; and
- relates to a service actually performed.
Even a disclosed cost must be refunded if the service was never performed. Subsection (4)(b) defines cost as the manager's out-of-pocket expense for a specific application service performed before approval or disapproval, including but not limited to a credit check. It expressly excludes payment for the manager's time or effort in arranging or performing the service.
The statute sets no numeric, per-applicant, per-household, or indexed ceiling. Its cost limitation is part of the refund calculation for the applicant who does not enter the rental agreement.
Damages and proof
Under § 37-56-109(3), a person who wrongfully withholds or deducts any portion of the fee is liable to the applicant for the amount wrongfully withheld. The court may award attorney fees to the prevailing party. The property manager bears the burden of proving the services rendered in connection with the application.
The section states no application-fee-specific local preemption or express preservation of stronger local rules.
What trips people up
The current statute is not the introduced bill. The current code applies to a property manager of four or more dwelling units. Earlier bill text used the broader phrase “landlord or manager,” but that is not the enacted wording.
Written allocation alone is not enough. The manager must also prove the service was actually performed, and may never retain the manager's own time or effort as a “cost.”
“Reasonable period” is not a fixed number of days. The statute does not convert that phrase into a 10-, 20-, or 30-day deadline.
Common questions
Does Montana impose a fixed dollar cap? No numeric maximum appears in the section. The unsuccessful-applicant refund is reduced only by qualifying disclosed costs for services actually performed.
Must the manager give me a screening report? The statute requires a written cost allocation, but no special copy of the credit, background, or screening report itself.
Does Montana require reusable reports? No statewide applicant-supplied or reusable-report procedure appears in the current statute.
What can I recover if money is wrongfully withheld? The wrongfully withheld amount, with attorney fees available to the prevailing party at the court's discretion.
Statutes and sources
- Montana Code Annotated § 37-56-109 — refund, written cost allocation,
permitted retention, damages, and definitions.
[T]he property manager may retain only the costs specified in the written notice for services actually performed and shall refund the balance ... The term does not include a fee for the property manager's time or effort.
Official source: https://mca.legmt.gov/bills/mca/title_0370/chapter_0560/part_0010/section_0090/0370-0560-0010-0090.html (accessed 2026-07-21) - Montana Code Annotated § 37-56-101(2) — property-manager definition.
“Property manager” means an individual who engages in the business of leasing, renting, subleasing, or other transfer of possession of real estate located in this state without transfer of the title to the property.
Official source: https://mca.legmt.gov/bills/mca/title_0370/chapter_0560/part_0010/section_0010/0370-0560-0010-0010.html (accessed 2026-07-21) - Montana Code Annotated § 37-56-104 — exemptions from property-manager licensing requirements.
The property manager licensing provisions of this part do not apply to ...
Official source: https://mca.legmt.gov/bills/mca/title_0370/chapter_0560/part_0010/section_0040/0370-0560-0010-0040.html (accessed 2026-07-21) - Montana Code Annotated § 70-24-204 — rental agreements given effect without both signatures.
[A]cceptance of possession of the premises and payment of rent without reservation by the tenant gives the rental agreement the same effect as if it had been signed and delivered by the tenant to the landlord.
Official source: https://mca.legmt.gov/bills/mca/title_0700/chapter_0240/part_0020/section_0040/0700-0240-0020-0040.html (accessed 2026-07-21)
Source links
Every statute quoted above, linked, with the date we checked it.
What does Montana law mean for your facts?
You just read the general rule. Ask your own question and see which parts of current Montana law apply to your situation, with citations you can check.
Opens in Ezel Pro.
- Starts from the statutes this survey is built on
- Cites every source it relies on, so you can verify it
- Chat, drafting and research in one workspace