Your First Apartment  On one side of a piece of paper make a list of everything you would want in an apartment…. cost is NOT a factor, but you may not have a roommate.  Look through an apartment guide or online at and find an apartment that closely matches your list.  Cut out or print and mount on paper.  Reflect in writing how you feel about this apartment selection.

OBJECTIVE 2.02 ANALYZE FINANCIAL AND LEGAL ASPECTS OF RENTING.

Landlords and Tenants  Landlords are owners of property. They expect the tenant to:  Pay rent on time  Keep property in reasonable condition  Tenants are renters. They expect the landlord to:  make necessary repairs to the property  Give written notice to enter the unit  Not increase rent until the lease ends.

Lease  The legal document signed by landlord and tenant  Includes:  Length of agreement  Amount of deposits, rent, fees, when rent amount can be changed  Address of unit  Who pays utilities  Number of people that can live in the unit  Pets (types and sizes).

The Rental Process  Application and Application Fee  Fee for filling out the application  Landlord knows you are serious  Usually $25-$100 or higher  Credit Check  Tells if the tenant is pays bills on time  Checked through a credit agency and is confidential.

 Security Deposit:  Covers cost for any future damage to the property other than normal “wear and tear”  May equal 1 or more month’s rent  Can be returned partially or in full  Pet Deposit  Covers damage made by pets.

 Advance on Rent  Landlord requires one or more month’s rent in addition to the security deposit  Renter’s Insurance  Insurance to cover the renter in the event of flood, fire, theft or any other hazard  VERY inexpensive.

 Utilities  Water, gas, sewer, electricity, phone, cable, trash collection  Sometimes the landlord will pay some or all utilities, BUT usually the tenant pays all.

Ending a Lease  Suppose you need to move earlier than expected. What are your options? 1. Continue to pay the rent until the end of the lease 2. Assign the lease 3. Sublet the lease.

Assigning the Lease  This means to transfer the remainder of the lease to another person  The original tenant is NO LONGER responsible for any rent or damages.

Subletting a Lease  Tenant leases the property to another person  BOTH tenants are responsible to the landlord  EX: college student leaving for semester abroad and lets friend rent apartment.

Results of Violating the Lease  Breach of Contract  Failure to meet the terms of a lease  Both tenants and landlords can be in breach of a contract  Eviction  Legally removing tenants from the property before the lease expires  May only start proceedings after the tenant has failed to meet the terms of the lease  Tenant must receive written legal notice of eviction.

How Much Rent Can I Afford?  In general your housing should not exceed 28% of your gross monthly income.

Max Monthly Rent  Gross income x.28 / 12

Calculating Rent if Paid by the Hour  Hourly wage x # of hours worked weekly x weeks in year = gross pay yearly / 12 months = gross monthly wage x 28% = maximum rent  Example:  $6.00 x 40hours = $240  $240 x 52 weeks = $12,480  $12,480 /12 = $1040  $1040 x 28% = $291.20

Weekly Income = $240  If paid by week: $240 x 52 weeks = $12,480/12 = $1040 x 28% = $  If paid by the month: $1040 x 28% = $  If paid by the year: $12,480/12 = $1040 x 28% = $291.20

So, how much can you really afford?  Choose your annual salary  Calculate your monthly salary needed for you to be able to afford the apartment you chose  Look back at your “want list”. Are there items you could live without in order to afford a less expensive apartment?  Reflect in writing how you feel about making changes to your “want list” selection.