CEE Standard: Saving
If your students are seniors this year, they’re probably looking forward to moving out on their own for the very first time. For some, that will mean living in a college dorm room; others may be looking to share an apartment rather than living on campus.
If they aren’t going to school, they might be looking for roommates so they can move out and be independent. Help your students learn everything they need to know about renting their first place and saving as much money as they can in the process.
The time has finally come to move out of your parents’ home and into your very own humble abode. Freedom, at last! But before you get too excited, there are some things you must consider, starting with if you’re even qualified to rent an apartment. Sit tight as I walk you through the step-by-step guide to renting your first place.
Step 1: Assess Your Credit Rating
Most landlords will want you to have stellar credit, especially considering you’re a first-time renter. Visit annualcreditreport.com to retrieve a free copy of your credit report and your credit score. Review the document in its entirety and dispute any inaccuracies using the instructions found there. Keep this information in mind when shopping around, and be sure to inquire about credit requirements before applying.
If you have no or low credit, your parents may need to step in as guarantors, putting them and their credit on the hook if you or your roommates run into rent payment problems. You will likely be asked to put down a first and last month’s deposit down.
Step 2: What’s Your Budget?
Like it or not, your monthly expenses are about to increase tremendously. That’s why it’s important to have a feasible spending plan so that you can gauge how much you can comfortably afford each month in rental payments.
Just because you have $600 remaining each month after expenses doesn’t mean you should go out and rent an apartment for $550. But why? The reason is simple: Renting an apartment comes with additional costs, including utilities and renter’s insurance (if you choose to sign up).
You may find that getting a roommate (or three!) is the only way to make living on your own feasible. Ask yourself if you are willing to share the bathroom with someone else in order to get the freedom you would like to have.
Step 3: What’s Your Desired Location?
Not all neighborhoods are created equal. In fact, some look stellar from the outside, but are riddled with excessive crime and many other issues that we won’t get into here. Be sure to keep this in mind when deciding where you want to live.
Your best bet is to look in areas with which you are familiar and enter the address into SpotCrime.com or the free app Citizen to get an idea of the amount of criminal activity that is taking place in nearby areas.
While location is important for safety, you also have to consider the costs involved. That trendy high-rise with the free gym membership and co-working space is going to be expensive. When you are first starting out, you may have to make concessions like living in a less convenient spot further out from your college or work location in order to save money.
Step 4: Preferences
A few things to consider include:
- Number of rooms
- Layout
- Features in the apartment
- Swimming pool
- Fitness center
- Fully furnished or not
- Appliances
- Pet policies
- Laundry facilities
- Roommates
Step 5: Compare Options
Once you’ve figured out where you want to live and exactly what you’re looking for in an apartment, start scouring the web and comparing properties to one another. Look beyond the monthly rental price to really determine which apartment will give you the biggest bang for your buck.
Does the unit come with a free washer and dryer to use instead of going to the laundromat? Are utilities like electricity and water included in the monthly rent or not? All of these things will make a huge difference in your monthly costs.
Step 6: Tour Your Top Selections
Schedule tours for at least five properties so that you’ll have a nice assortment of options to choose from. When you arrive, ask to see the actual unit you’ll be occupying so that there won’t be any surprises on your move-in day. Check the air-conditioning unit, sinks, toilets, outlets, appliances, windows, and locks to ensure that they are all working properly.
Step 7: Complete the Application
Schedule an appointment with the leasing office to complete your application. If it can be done online, you’ll save some time and an extra trip to the landlord’s office. Just be sure to have the funds for the application fee on hand. Also, inquire about the security deposit and any other applicable fees you must pay before you can move in.
Step 8: Sign on the Dotted Line
Upon approval — which could take anywhere from an hour to a week or so — you will be invited to sign your rental agreement. Since this is your first rodeo, you will want to allocate a decent chunk of time so you can thoroughly review the rental agreement and address any questions or concerns that may arise.
Also, be sure to inquire about the policy for terminated lease agreements, in case you need to walk away before your lease is up.
Bonus: Move In and Enjoy Your Newfound Freedom
Congratulations on your first apartment! You can now breathe a sigh of relief and enjoy privacy, but don’t forget to budget your funds each month to ensure that you can continue to make timely payments. Do not fall behind on rental payments — you want your own space, not a hit on your credit score.
- Would you prefer to move into an apartment or dorm room? Why?
- Do you know your credit score?
- Write out your budget so you can determine how much you could afford to pay for rent each month.
- What are your preferences when it comes to the type of apartment you live in? List them.
- Do you have any roommates in mind if you can’t afford an apartment on your own? What challenges do you anticipate if you have roommates?
