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Application Process

I want to revamp my lease application process and make sure I do official background/credit checks on serious applicants.  What is the best way to do this when a fee is involved?  Should it be considered refundable?  Or non-refundable to weed out the riff raff?  I considered calling it refundable after one year's tenancy with no problems or is that just opening a can of worms best left alone?  Should I split the cost with the tenant?  TIA
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