5 Money Rules First-Time Renters Should Know Before Signing a Lease
Moving into your first apartment is exciting, but it can also feel overwhelming. For first-time renters, a lease is the most important document you will ever sign. The lease agreement outlines the responsibilities and protections for both the tenant and landlord, and it also details the rules.
Before you sign the dotted line, here are 5 money rules you need to know as a first-time renter.
Learn More: If Housing Is Eating Half Your Paycheck, This Is the Financial Triage Step You Cannot Skip
Find Out: 9 Subtly Genius Things All Wealthy People Do With Their Money — That You Should Do, Too
1. Understand What Your Security Deposit Can (and Can't) Cover
Your landlord will likely collect a security deposit before you move in, which is usually one or two months’ rent depending on your state. This is the amount you pay upfront to protect the landlord against unpaid rent or damage beyond normal wear and tear.
Before you unpack a single box, make sure you take photos and videos of the apartment's condition, so you have proof of any existing damage. This documentation serves as proof if your landlord attempts to withhold your deposit when you move out.
2. Know When Rent Is Due and What Happens If You Pay Late
Your lease should include the due date for rent payments, the mode of payment and the consequences of late payment. If you pay your rent late, you may face late fees, and repeated late payments can trigger legal actions.
Review the lease carefully so you understand grace periods, acceptable payment methods and the consequences of paying late.
3. Get Renter's Insurance Before You Move In
Many first-time renters assume the landlord's policy will protect their belongings. That isn't always the case. If your laptop is stolen or a burst pipe ruins your furniture, you're on the hook. That’s why getting renter’s insurance is important.
Renter's insurance typically covers personal belongings that are damaged or stolen and may provide liability protection if someone is injured in your apartment. While some landlords require it and others don’t, it's worth getting one regardless.
4. Know Which Repairs Are Yours and Which Aren't
A common mistake first-time renters make is thinking the landlord pays for all repairs. Generally, a landlord is responsible for keeping a property safe and livable. As a tenant, you’re responsible for keeping the unit clean and reporting problems promptly.
You may be financially responsible for damage caused by you, your guests or your pets. If you know these responsibilities, you can avoid losing some of your security deposit. If something breaks that's the landlord's responsibility, report it in writing.
5. Find Out What Breaking the Lease Will Cost You
Life happens. Maybe you find a new job, need to relocate or decide to move before your lease ends. That's why it’s important to understand the early termination rules of the lease before you sign.
Some leases have you pay a fee to break the lease, lose a portion of your security deposit or pay rent until a new tenant is found. Evicting without going through the right process can cause financial and legal problems, so read this section of your lease thoroughly.
To help Americans navigate the added cost of summer, MoneyLion is giving away $1,000 every day through July 4. Enter the Summer Break Giveaway here (No pur. nec. Ends 7/4/26. See Official Rules at mlion.info/summerbreakofficialrules)
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
More From MoneyLion: