In Part One, we looked at whether renting is a real option for young adults today.
During high school and college, students start to think about how to begin the next stage of their lives. This often involves moving out of the family home and becoming more self-reliant. At around this age, you may have decided to move out of your parents’ house and live on your own. Congratulations and applause are in order because this is a huge first step to make on your path to independence and adulthood. It might be hard at first, but you will become used to cooking your own meals and waking yourself up for school or work.
The next thing is determining where you will live, and in today’s market, that might be the tricky part. Unless you come from a millionaire family, you will probably be starting out as a renter. With that in mind, how does renting work anyway?
How Does Renting Work?
When you move into an apartment building, a shared house, or a homeowner’s spare bedroom, you will be paying rent. This is a monthly cost you pay a landlord to use his or her property for an agreed length of time.
During your search, you will submit a tenant application that may require:
- Paystubs (or some other proof of income).
- References (to vouch for your reliability).
- Bank statements.
- Driver’s license (or a form of ID).
- Social Security card.
Because this is your first apartment, you could also get a co-signer (someone who agrees to cover the cost of your rent if you fail to pay for some reason), which would raise the odds of being accepted for the apartment.
A lease is a legally binding contract that sets the terms of rental agreements. The lease will cover topics including total monthly rent, length of the lease, penalties for late payments, tenant restrictions (e.g., pets may not be allowed), and landlord responsibilities.
You will most likely need to provide a first and last month’s payment upfront. You might also need to give a security deposit – a sum of money given to the landlord in advance that covers future damages. The deposit may or may not be refundable, depending on the lease.
It is important to carefully read the lease and ensure you understand what you are responsible for, what amenities (swimming pool, parking, gym, etc.) you have access to, or if you are permitted to have roommates. You never want to break the terms of the lease, as this could result in you being kicked out of the property.