When deciding where to rent a place to live, you’ll have more details to think about besides the monthly rent payment. If you’re new to renting an apartment or house, here are five factors to consider before you sign a lease agreement.
Understand the terms of the lease
One of things you need to understand about renting is your lease agreement. A lease is the legal arrangement between you and your landlord or rental company. This document contains the rules for renting your apartment or house. It details the length of the lease, the monthly rent payment, your responsibilities as the tenant and the responsibilities of the landlord or rental company. Keep a copy of this document in a secure location in your home. Consider keeping a duplicate copy in a safe deposit box at your nearest Credit Union branch.
Be sure to read the entire document. This way you’ll know exactly what you’re agreeing to. Don’t be afraid to ask questions if there are terms and conditions you don’t understand. Once the lease is signed, it can be costly to terminate the contract prior to the end of the term.
Know your upfront housing costs
In addition to budgeting for the monthly rent, be prepared to pay additional upfront costs associated with signing a lease. It’s common for a security deposit to be required by the leasing company or landlord before they’ll allow you to move in. Review your lease agreement for the specific dollar amount. The security deposit is often the lump-sum combination of first and last month’s rent or as indicated on the lease agreement.
A security deposit protects the landlord or leasing company in case of property damage or non-payment of rent. You may also have to pay an application fee.
The amount of the security deposit and any application fees may vary based on the type of apartment or house you’re renting and the location.
Budget for ongoing monthly expenses
In addition to your rent, you should know what additional monthly expenses you’ll have when renting an apartment or house. Utilities, like heat and electricity, are not normally included in the monthly rent. Different rental companies and landlords will have different rules about what you’ll be expected to pay versus what will be covered in your rent. Those details will be included in your lease agreement.
Prior to signing the lease, be sure to verify your responsibility for any ongoing monthly costs. This way you’ll have a better idea of whether you can afford the place for the duration of the lease. You’ll sleep better at night knowing that your lights will turn on every time you flip the switch.
Don’t forget renters insurance!
Some rental companies and landlords may require you to take out a renters insurance policy; however, it is something to consider even if it’s not required. Renters insurance, like homeowners insurance, protects you and your belongings in the case of accidental damage, theft or disaster.
Whether your landlord requires insurance, or you simply feel more comfortable knowing your things are protected, LGFCU can help with an affordable homeowners insurance policy, which covers you even if you’re a renter. You may be able to save on these monthly costs when you bundle your homeowners and auto insurance.
Renting an apartment with roommates
If you’re going to live with one or more people, make sure all your roommates sign the lease. A roommate who doesn’t sign the lease could complicate your living arrangements if he or she decides to stop paying rent. You may end up responsible for the missing portion of the rent.
Inquire about a pet policy
Many landlords and leasing companies are pet-friendly. However, you’ll need to talk with your landlord about your pet(s) before you sign the lease. There could be restrictions surrounding weight, breed, type of pet permitted and/or the number of pets allowed. In addition, it is common for a pet deposit to be required when you put down the security deposit mentioned above.
Sometimes, instead of a pet application fee, you may have to pay a higher monthly amount to keep Fido or Fifi in your home than you would if you didn’t have a pet. These are costs you’ll want to account for in your budget.
These rules for renting an apartment or house may help guide not only where you choose to live, but how you live.
The advice provided is for informational purposes only. This article originally appeared June 2018.