1. Managing Resources Personal Finance Unit 5 Section 1—Renting An Apartment

2. Renting An Apartment I.ADVANTAGES & DISADVANTAGES A.ADVANTAGES OF RENTING 1.Easy care/low maintenance 2.Usually a lower down payment than buying a house 3.Greater mobility to move when you want to move B.DISADVANTAGES OF RENTING 1.No equity (no ownership of the property) 2.No tax breaks 3.Subject to less privacy and must accommodate others lifestyles/habits

3. Your Rights and Responsibilities A.TENANT (lessee) 1.Rights a.To live in a habitable place (fit to live in) b.You may not be denied the right to rent on the basis of race, national origin, ancestry, religion, gender, or disability 2.Responsibilities a.Pay the rent on time b.Abide by the rules of the lease agreement c.If you (or your friends) break it, you fix it! B.LANDLORD (lessor) 1.Rights—to inspect the property for safety, sanitation or violation of the lease agreement 2.Responsibilities a.Maintain and repair property b.Keep the common areas clean and safe

4. What to Look for When Leasing A.HOW MUCH CAN YOU AFFORD? 1.Determine your monthly expenses 2.Consider your income (Rule of thumb: No more than 25% of take home pay) B.FURNISHED OR UNFURNISHED? 1.Costs more to rent a furnished place 2.If you choose to buy furniture, you will have to plan on the expense and work of moving it and purchasing renter’s insurance

5. What to Look for When Leasing? (concluded) C.WHAT AMENITIES? 1.Which appliance do you HAVE to have (A/C, dishwasher, etc.) Make sure what is provided and that they are in good working order What other options are important to you (swimming pool, satellite, garage/covered parking, security, etc.) D.LOCATION? 1.Distance to work? 2.Closest grocery store/gas station? 3.Access to the freeway or public transportation? 4.Safety of the neighborhood and/or complex?

6. Rental Agreements A.ORAL AGREEMENT 1.Usually a month-to- month term 2.Rent may be raised at any time 3.Misunderstandings can lead to serious problems—avoid an oral contract

7. Rental Agreements (concluded) B.WRITTEN LEASE 1.Written agreement that stays in effect for a specific period of time 2.Both landlord and tenant are bound by the terms of the lease regarding rent, pet policies, eviction process, etc. 3.Lease is prepared by the landlord so they are written for HIS/HER best interest and protection 4.You must read the entire lease carefully!! Don’t sign anything unless you understand all of the terms of the contract. Keep a copy for your own records. 5.Leases may be changed in some way IF BOTH parties initial the contract changes. 6.What if you need to break your lease? a.Give your landlord as much notice as possible. Many require 30 days notice even at the end of the lease b.Talk to your landlord about your options c.Sublease—allows someone else to take over your apartment. i.Must have landlords permission ii.Be careful—often times YOU are still responsible for damages, rent payment, utilities, etc.

8. Eviction A.Legal notice that you are subject to being removed from the property (by force if necessary) B.RULES FOR EVICTION 1.Landlord must receive a court’s permission to evict 2.You must be given five days notice prior to being removed 3.Landlord cannot change the locks during that time 4.Landlord cannot have the utilities disconnected 5.Landlord cannot take possession of your belongings as collateral for nonpayment of rent 6.Any items left in the apartment after the five days are considered abandoned and become the property of the landlord

9. What to Expect Prior to Moving In A.PAY DEPOSITS 1.First/last month’s rent—assures landlord that you won’t move out without paying 2.Cleaning Deposit/Fee—usually refunded if you leave the apartment spotless 3.Security Deposit—covers any damage to the property, any repairs necessary, or any unpaid rent 4.Pet Deposit—covers damages caused by your pets. Often items this is a NON-REFUNDABLE deposit.

10. What to Expect Prior to Moving In (continued) B. Missouri law requires that the landlord refund your deposits to you or provide you with a written explanation for no refund within 30 days of your departure. C. Go over everything in the apartment to check for damages that already exist. Make a written list, give it to the landlord and keep a copy for your records.