Rental application fees, minimum spend demand from retailers, plus the downside of Facebook quizzes
Consumer journalist Wendy Knowler’s ‘Watch-outs of the week’
In this weekly segment of bite-sized chunks of useful information, consumer journalist Wendy Knowler summarises news you can use:
Are rental application fees legal?
Surely estate agents don’t have the right to ask prospective tenants to pay a fee just to apply to rent a property, regardless of whether they are the chosen ones?
“Nick” recently raised the issue on Twitter: “Been asked by an estate agent in Cape Town to pay an application fee of R950 just to apply to rent an affordable apartment. Not guaranteed I’ll get it. This seems like extortion. If there are 10 applicants, the agent gets nearly R10,000 in application fees.”
I asked Cape Town-based rental property attorney Marlon Shevelew if there was a law or regulation prohibiting the practice.
“While there is no law as to how much a rental agency or landlord can charge for a lease agreement, the Rental Housing Act (RHA) stipulates ‘any costs in relation to contract of lease shall only be payable by the tenant upon proof of factual expenditure by the landlord’. But it is not entirely clear if that section was intended to apply to application fees,” he said.
As there is no legislation preventing such fees from being charged, estate agents are permitted to charge them, he said.
“At the core this comes down to the right of the landlord to set selection criteria.
“Since the ability to pay is an essential part of finding desirable tenants, and discrimination on the basis of ability to pay is not prohibited, such fees are in principle permissible.”
There you have it.
But yes, it’s a screening process which doubles as quite a nifty income stream. Clearly the rental market has picked up nicely.
Retailer can’t force you to spend a minimum amount on your credit card
Have you ever added a pack of sweets or cold drink to your purchase because the retailer told you you had to spend at least R50, or whatever, to pay by credit card?
The “minimum spend on card” thing has become common practice in many smaller stores and fuel station shops, so much so that many consumers assume it is legitimate. But it’s not. Nor is adding a percentage, usually 5%, to the advertised or marked price of a product if a customer chooses to pay by card.
It’s a contravention of the Consumer Protection Act (CPA) which states, in brief, that the advertised price may not be inflated. It also violates their merchant’s agreement with their bank, which states they may not pass on their bank fees to their customers.
Imposing a minimum spend for card payments is not covered by the CPA, but Mastercard and Visa prohibit merchants from imposing a minimum transaction value on credit card payments.
I recently asked the Banking Services Ombudsman whether this also applied to debit card payments.
Assessments manager Edrich Buytendorp said according to all the banks, merchants are not entitled to require a minimum payment when payment is made by card, debit or credit.
The merchant could lose their card machine if they are found guilty by their bank of this misconduct.
Here’s the thing: banks won’t know this is happening unless you report it to them. If a retailer expects you to pay extra for paying by card, or has imposed a minimum spend for card payments, report them to their bank.
The point-of-purchase machine on the pay station counter will be branded by the bank which supplied it, so that’s how you know which bank to approach.
The downside of Facebook quizzes
The incidence of impersonation fraud shot up by more than 330% in 2020, the year in which more of us embraced the digital life more than ever. Sadly, Facebook is a wonderful resource for fraudsters of all kinds.
Those “tell us about yourself” questionnaires which are fun to answer play right into their hands because the answers you provide — where you grew up, your mother’s maiden name, your favourite band and your children’s or pets’ names — are often also incorporated into your passwords and provide the answers to common security questions.
Don’t do it. Also, go into Facebook’s privacy settings and lock down on who can view your posts.