Your First Apartment

Make a list of everything you would want in an apartment…. cost is NOT a factor.

Look online to find an apartment that closely matches your list.

Print a picture and the information (amenities) about the apartment. Be sure to include the monthly cost.

Include a reflection in writing of how you feel about this apartment selection.

OBJECTIVE 2.02ANALYZE 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.

How Much Rent Can I Afford? In general your housing should not

exceed 28% of your gross monthly income.

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% = $291.20

If paid by the month: $1040 x 28% = $291.20

If paid by the year: $12,480/12 = $1040 x 28% = $291.20

Complete “Finding Maximum Monthly Rent”

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 lease2. Assign the lease3. 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.

In summary…..

So, how much can you really afford?

Calculate your monthly salary needed for you to be able to afford the apartment you chose

Rent / .28 = monthly salary What is the average monthly salary in the area

you have chosen to live? Can you afford to live there if you earn an

average salary? Do you need to make changes?

Reflect in writing the changes you will make and how you feel about making these changes to your selection.