Avoiding Predatory Lease Agreements

College students looking to sign their first lease agreement on their own are especially vulnerable to predatory clauses and arrangements. Find out what to look out for before signing and what rights predatory landlords don’t want students to know about.

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As largely unqualified renters, students don’t have much power and choice when searching for their first rental. Little credit history, no past references for rentals, and a lack of long-term employment means a student may have trouble finding a place to live in an established community. Some students may be lucky enough to have a parent co-sign, but not all do. When you become desperate to find a place, that is when your chance of falling for predatory lease agreements is especially high.

The following guide will help keep you well informed during your rental search so that you can avoid the scams and find yourself a great place to live.

Always Get It in Writing

Before we talk specifics, the most important item to remember with any legally binding contracts is to get it in writing.

Vague leases are dangerous because they limit your protection by opening you up to problems down the road. While every renter has certain inherent rights under state law, chances are your landlord will be much more familiar with them than you will be and will know where they can toe the line (i.e. state laws are highly variable on limitations for certain fees like late rent, bounced checks or security deposits). Therefore, the best defense against this disadvantage is to think through each potential issues and get them in writing from the start.

Any lease agreement you sign should have explicit policies for a wide range of situations, including animals, maintenance, parking, move-outs, and more. We’ll go through the most important ones below.

Understanding Your Lease

Knowledge is power, and as a new renter the more information you have, the better off you will be. After all, if you don’t understand the terminology of your contract, you can’t be aware of scams or predatory leases in your contract! An informed renter is a safe renter, so keep reading to learn about the most important parts of your lease and what you should expect from them in the contract.

Topics we’ll cover: Lessee vs Lessor | Security Deposits | Overnight Guests | Grace Periods | Outdoor Spaces | Evictions | Inspections | Pet Policies | Fixed vs Non-Fixed Term Agreements | Sub-leasing | Breaking a Lease | Noise Ordinances | Security Requirements

Lessee vs. Lessor

Lessee: You | Lessor: the Landlord

Often, these are the terms used in generic lease agreements (aka ones that are handed en masse in college towns). Don’t get them confused. Sometimes it is helpful to take a highlighter with you to the signing and highlight all of your (lessee’s) responsibilities.

Buyer Beware: Know your rights, responsibilities and, equally important, know your landlord’s rights and responsibilities. Be wary of anything that says “I forfeit my right to an attorney” or “I will not seek legal action”. These are often thrown into the fine print and nullify any possibility of legal action later, if necessary, opening you up to further abuse.

Security Deposit vs. Upfront Costs

It is very common for landlords to expect first and last month’s rent in addition to a security deposit (usually a full month’s rent) as well as additional deposits including pet deposits, utilities deposits, etc. upon signing the lease. Expect to write a hefty check the day you sign the lease. All of these things combined, including an application fee, are called upfront costs. The security deposit is used solely for the purposes of maintenance and unforeseen repairs after you leave. The security deposit is sometimes tied to your credit score, so as a young, inexperienced renter, expect to pay a higher premium than someone with established history.

Buyer Beware: Be sure to read what deposits are refundable and which are not. Often, pet deposits are non-refundable, however most others are. If you take good care of your apartment, you should expect to get at least some of your security deposit back. In most states, landlords must provide a written receipt of itemized deductions of their security deposit within a set time limit(usually between 30-90 days). This is a very common predatory practice! Often, apartment complexes will overcharge former tenants on repairs once they’ve left the apartment. Be sure to document the condition of everything with pictures and in writing to ensure fair treatment.

In addition, read your lease to understand if you are responsible for any repairs on your own. Sometimes, even replacing a light bulb instead of letting maintenance do it is considered a violation of lease terms and subjects you to forfeiture of security deposit. This is a predatory practice that can be snuck into leases. Read carefully. If there are no damages, you should not be charged.

Overnight Guests

One of the biggest perks of renting your own apartment is being able to choose whom and how long guests can stay over. However, be sure to read the lease terms carefully as sometimes landlords will restrict who can stay for how long. Always be sure your guests park in visitor parking and ensure they have a visitor’s pass if necessary. There are often time limits on how many times a week a particular car can stay in the visitor lot. In addition, check your lease to see if every overnight guest needs to register with the front office. Following the rules helps ensure you will not be subject to any extra attention from the leasing office.

Buyer Beware: These rules and policies are not illegal. They are designed to protect the landlord/complex from illegal subletting and unauthorized individuals living in the apartment/over occupancy. However, assuming you follow the rules, there should not be any restriction on the guests you have. Remember, you are legally and financially responsible for all guest behavior at all times so choose your guests wisely.

Grace Period

This is also a common question for lessees. When is the rent due and how long do I have to pay it before late fees are assessed? Your lease will explicitly state both of these things so pay attention. Landlords will not be shy about assessing late fees – it’s the easiest way to make more off of inexperienced tenants with tighter financial restrictions. Something to note is whether the lease agreement says “due by the Close of Business” or due by a certain date. If the agreement says close of business, then you must get your check to the main office by the time they lock the doors to avoid late fees. Make sure your check is good too, otherwise you might incur a “service fee” which is perfectly legal.

Buyer Beware: This should go without saying, but get a receipt for everything, including each monthly rent check. It’s tempting to just drop it off in the “payments” box at the front door and be done with it. However, if you do that, request a payment receipt the following day. There is little to protect if you don’t have a receipt saying you paid on time.

Decorating/Outdoor Space rules

It’s exciting to get your first apartment and decorate it to your tastes and style! However, read the fine print on what you are and are not allowed to do in your apartment. There are usually restrictions on what furniture you can bring in (i.e. No water beds), if you can paint the walls, and what outdoor furniture (i.e. grills) you can have. Remember, if your new apartment has a balcony, the landlord can see every violation in plain few…so don’t have any!

Buyer Beware: It is common practice to require tenants to repaint the walls back to the original color before leaving the apartment. However, it is also common practice for landlords to say the paint was not done to a satisfactory level, and thus charge the tenants for repainting, taking it out of their security deposit. Be sure to get your apartment inspected by the landlord before leaving and get a signed paper stating your repaint job was satisfactory to avoid this complication. Alternatively, get a landlord-approved contractor to ensure things meet their expectations.

Generally, a walk-through is done before the end of a lease to help the tenant and landlord know what costs to expect upon your departure. DON’T SKIP THIS STEP and don’t let them do the walk through without you present.

Evictions

Nobody wants to wake up with an eviction notice on their door or worse – come home to your things on the curb. An eviction is an involuntary removal of you from your apartment usually because of unpaid rent or other lease violations. This is hopefully something you never have to deal with, but it’s important to know your rights in any unforeseen circumstances. Each state has different laws governing eviction and the rights of the tenant in each.

Buyer Beware: In most cases of eviction, the tenant must be given ample written notice and it must go through a court system to get evicted. There are certain cases that tenants can be given an eviction notice immediately. Often these are things like drug dealing, prostitution, homicide, and other other illegal activity, but also repeated, gross lease violations are a legal reason. Check with your state to see when it is legal to give an “unconditional quit” lease termination. It is always best practice for you to have a copy of your lease in a safe place like a parents’ house or a storage unit where you can easily access it in case of an “unconditional quit lease termination. Of course, you should always pay your rent and follow your lease terms, but that is why it is important to have very specific lease terms so you know what you can and cannot be evicted for because an eviction can turn your life upside down in a hurry.

Inspections

Your landlord will have to come into your apartment from time to time for inspection, routine maintenance, and occasionally for apartment tours. However, very few causes call for unannounced inspections. This is where it’s important to know your tenant rights and laws for your specific state. In most cases, you should be given ample warning (at least 24 hours). Be wary if the “inspection” section of your lease is short and vague. It should very explicit and pretty lengthy. You want to know when you are giving your landlord permission to enter your leased apartment.

Buyer Beware: What you sign is what will be enforced. So if you don’t read this section of your lease carefully and just haphazardly sign saying you agree to let your landlord enter at any time without warning, then that is what is legally binding. Yes, it is shady, and can be illegal, but you signed the contract. Don’t fall victim to this.

Pet Policies

Our furry (and not so furry) friends are often a perk of apartment rental, but the specifics of leasing and pet ownership are often quite tricky. There are usually restrictions on quantity, breed and weight, leash laws, and other policies that are important to read carefully, because violation of these terms constitutes a violation of your lease and could put you in danger of eviction.

Buyer Beware: The pet policy is often an addendum on your lease and should be specific. Read it carefully for breed restrictions. You’ll likely need specific paperwork from the adoption agency stating the breed for it to be approved. Also, think that fish tank is harmless? Think again, many leases just outright ban them because of possible water damage. Read your terms carefully.

NOTE

It is illegal for a landlord to impose a deposit fee for service and assistance animals. Learn about these protections under the Fair Housing Act by clicking here.

Fixed-Term Lease Agreement vs. Rental Agreement

This is nuanced terminology and one that landlords tend to take advantage of with inexperienced lessees. Your lease should clearly state whether it is a “Fixed-Term Lease” or a “Lease Agreement”. One implies a month-to-month lease while the other implied a specified time in which no changes can be made without both parties’ approval. A “fixed-term lease” has a specified start and end date and the terms within the lease are good for that specified amount of time. Any deviation from that must be in writing and addendums added for the contract to be legally binding. If you sign a general lease agreement with no term limit, otherwise known as month-to-month lease agreement, terms may be changed with much shorter notice and either party can terminate with much shorter notice. In a fixed-term lease, generally you must 30 days notice if you wish to terminate your lease.

Buyer Beware: Many states have laws regarding how much notice is needed to terminate your lease, it can be anywhere from 7-90 days so check with your state laws and check with the requirements of your lease. Remember, what you sign is what will be enforced, so don’t sign if it doesn’t fit with your state laws.

Sub-leasing

If you’re in a college town, it likely means you are a transient member of society, perhaps going home for summer break or studying abroad, but what if you want to keep your apartment? This is a very tricky part of lease law and one that landlords are quick to prey on inexperienced lessees. Read the Sub-leasing section of your lease carefully. Some landlords outright ban it, which they are perfectly within the law to do. Others have very specific guidelines that you must follow in order to be considered within your lease terms and therefore not up for eviction when the landlord finds out. Did you notice I said “when” the landlord finds out? That’s because in a college town where transient populations are the norm, subleasing is also the norm and landlords are savvy to almost every trick in the book with regards to subleasing. If it violates the lease, you better believe they will enforce it.

Buyer Beware: If you follow all of the lease terms that you signed, then you should have no problems. However, it is a good idea to document everything because you are ultimately responsible for the sub-letter’s behavior in your apartment and the landlord is likely to take advantage of that.

Breaking Your Lease

Although unforeseen, sometimes issues come up where you have to break your lease early. You may have an emergency to deal with, or it may just be time to move for your family, work, or financial situation. Not all reasons for breaking your lease are negative, but if your lease is strict about termination, you may be in for a stressful time.

Buyer Beware: Your lease should outline the exact process for terminating your lease early. It’s good to know these ahead of time so if the time comes where you need to break your lease, you’ll be ready for any fees, timelines, or additional requirements you need to fulfill.

For example, in some states when you break your lease the landlord is required by law to make ‘reasonable’ effort to find a new tenant, so if you see something in the fine print about requiring you to pay the full term of the lease, stay far away!

Noise Ordinances

Think you’re going to be able to party all night on the weekends? Think again! Noise complaints are a surefire way to get in hot water with your neighbors and landlord, so be sure to consider what your lease allows for.

Buyer Beware: There are state laws which explicitly state what is and isn’t a reasonable noise expectation. For example, in some states a barking dog at any hour is considered a noise violation and subject to landlord intervention, however in other states, it is only during imposed “quiet hours”. The landlord is responsible for most noise violations, so if you’re having a problem with a neighbor’s noise, you can go directly to your landlord and vice versa. Know these laws so your landlord can’t arbitrarily cite you for noise ordinance violations.

Security Requirements

Security is an important part of any apartment rental or home rental within a community because it not only keeps renters safe, but also protects the owners. It is relatively common for security cameras to be used in public parts of the facility, so be sure to check your lease so you know what to expect.

Buyer Beware: Under no circumstances should a landlord ever request to put a video or audio recording device in your private residence. However, it is perfectly legal for cameras to be installed in hallways, at entryways, and other public areas. This can help reduce crime, but can also be used to monitor who is entering and leaving your apartment. Read your lease carefully to see if these are mentioned and if so, be mindful that your occupancy or overnight stay rules may be enforced with video!

Renter’s Rights by State

Beyond some of the specifics we tackled above, it’s always important to stay up to date with the rights you have as a renter under state law. We collected & curated a list of our favorite guides for each state below.

Additionally, responsible landlords can click here to learn about what they’re required to disclose to tenants by state law in the lease agreements themselves (i.e. specific health hazards, previous rental activity, etc.).

Final Advice

It is very exciting to rent your first apartment and take the first steps to total independence. As a young, inexperienced renter, it is equally important to do your research and know your rights ahead of time. Landlords are savvy people who may be looking to prey on your inexperience. Follow the above advice and become a happy apartment renter.

Remember: read everything, ask questions, and don’t sign until you understand the lease fully!

Additional Resources/Works Referenced

https://www.doorsteps.com/articles/7-mistakes-to-avoid-when-renting-your-first-apartment
https://www.apartmentguide.com/blog/common-rental-lease-terms/
https://www.apartmentguide.com/blog/things-to-think-about-before-renting/
https://www.thebalancesmb.com/illegal-actions-your-landlord-could-be-taking-4154964
https://www.updater.com/moving-tips/what-is-a-security-deposit
https://www.nolo.com/legal-encyclopedia/chart-security-deposit-limits-state-29020.html
https://www.nolo.com/legal-encyclopedia/state-laws-termination-violation-lease.html
https://www.nolo.com/legal-encyclopedia/state-laws-unconditional-quit-terminations.html
https://reolink.com/legality-reason-for-security-cameras-in-rental-property/
https://www.nolo.com/legal-encyclopedia/neighbors-noise-faq.html