Deciding to rent? 5 tips for renters
If you decide to rent, following these five simple tips can minimize your risk and maximize your success for selecting an apartment.
There are many variables to consider when you are deciding to rent a home. The decision to become a tenant can be rewarding but also challenging. One variable that may be an advantage when renting is leasing flexibility. Being able to choose the term of your lease may be beneficial for you. If your circumstances are fluid, a month-to-month lease gives you the option to move on short notice.
By renting, you eliminate the cost of repairs as they are the responsibility of the landlord. Renting may also be more suitable if you are on a budget. Rent can be significantly less than a mortgage because renter’s insurance is cheaper than homeowner’s insurance and there is no property tax. If you decide to rent, following these five simple tips can minimize your risk and maximize your success for selecting an apartment:
- Budget: Create a budget and stick to it. This way you can track your spending and income. By doing this, you will have an accurate picture of your financial situation and have the reserves set aside for your rent payment. Your rent should be no more than 25-30 percent of your income.
- Location: The location is a key factor when it comes to choosing an home. One of the most important things that you want to decide on is where exactly you would like to live. Which neighborhoods do you like? Is it close to your employment, grocery stores, schools, restaurants and parks? How is the crime rate? You must consider all this before selecting a home to rent.
- Understand the lease: Your lease is a binding legal document, and it is imperative to understand everything before you sign. Make sure the information in the lease is exactly what your landlord told you verbally and make sure you read it. If something is unclear or you do not understand, ask for clarification.
- Get everything in writing: In order to protect yourself and your interests, get everything in writing. Beginning with the rental application and lease or rental agreement, be sure to document important facts. Putting everything in writing will help prevent you and your landlord from forgetting exactly what was agreed to.
- Get renter’s insurance: Renter’s insurance is a type of insurance that protects the renter, as well as their property. Just like other forms of insurance, customers will choose their amount of coverage and deductible, and be then required to pay a premium based on these, as well as a few other, factors. Ask your insurance representative about the exact coverage in any policy you consider.
Remember: by following these five simple tips, you can minimize your risk and maximize your success for selecting an apartment.
Michigan State University Extension offers financial management and home ownership education classes. For more information of classes in your area, go to either the MSU Extension events feed or MI Money Health.