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Renting Stage 3 - Understanding the Lease

Updated 4-24-2023

This Expert Adulting Module Will: 

  • Help you protect yourself when signing a rental agreement / lease

  • Help you understand what you are agreeing to if you sign it 

Hand signing document
Black man pondering in front of papers
Positive Neutral Negative

Your Signature   =    Your Responsibility  =  Your Consequences

Most Important Things To Understand

  1. Understanding the agreement BEFORE YOU SIGN IT is extremely important. (This is NOT an ‘I’ll sign it now and read it later’ situation.) You are stuck doing whatever the agreement says for the entire term so make sure you know exactly what you are committing to.

  2. Realize that the lease is primarily written to protect the property owner’s money and property – NOT YOUR’S – be careful.

  3. When you sign a rental agreement, you are signing a legal contract. The consequences of not following the terms of the contract are NOT pretty.

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Questions For You to Answer

(see info below for how)

  1. Can I financially afford to sign this lease and still live comfortably? (Have enough money left for food, utility payments & fun?)

  2. Does my lifestyle fit in with the rules they are asking me to follow? If not, would my life be more enjoyable over the next year (or length of the lease) if I found another place to live even though that will require more effort now?

  3. Do I understand all the terms of the lease so I am sure that this is a good deal not just for them but for me too?

Renting Module Format

To help you find, qualify for, and enjoy your new rented apartment or house, I’ve mapped out all the steps involved and then broken them into 4 Renting Stages to make them easier for you to understand & work on:


Stage 2 - Finding the Rental You Want
Stage 3 - Understanding the Lease / Rental Agreement (this page)
Stage 4 - After You've Signed the Lease 

Step by step

Rental Leases Are Serious Business


The rental agreement / lease is written primarily to protect the property owner’s money and property NOT YOUR’S. Realize this and make sure you are willing to follow the lease to a “T” because YOU will be the one to suffer if you don’t.

Warning light

A lease (including its addendums) is a legal contract – once you sign it, you are required to do what it says until it ends.

Signing a rental lease commits you to some big responsibilities:  

  • Paying lots of money (usually 25-33% of your income)

  • Living there until the end of the lease term

  • Following all their rules for the length of the lease term

Money - Hundreds

And, if you don’t follow the terms of the signed lease, they can:

  • Kick you out of your rental

  • Keep your security deposit

  • REQUIRE YOU TO PAY ALL THE RENT THROUGH THE END OF YOUR LEASE TERM EVEN THOUGH YOU NO LONGER LIVE THERE. (In fact, you may be required to pay this immediately if evicted.)

  • Charge any additional penalties written in your lease

  • Take you to court

The consequences of breaking a lease could follow you for a VERY long time and negatively affect your:

Application - Rejected
Credit Score - Hand holding phone
Money in your pocket
  • Ability to rent another place

Landlords / property managers use tenant reports &/or information from your previous landlords to learn about bounced checks, late payments, evictions, complaints against you, etc. Your chances of getting approved for a new rental decrease dramatically if they learn that you didn’t follow the ‘rules’ of your previous rental agreement. 

  • Credit Reports / Credit Score

If any rent / fees / penalties are left unpaid (according to the landlord), those debts will show up on your Credit Reports and reduce your Credit Score.

  • Future cashflow (cashflow = how much money you have left in your pocket to spend the way you want to)

A less-than-stellar tenant report may lead landlords or property managers to require higher security deposits or rent payments as a condition for renting a property (assuming they will rent to you at all). That’s more money in their pocket – less in your pocket.

The lower your Credit Score, the more you will have to pay in interest, fees, and deposits which again results in you having less money to spend the way you want. (See Credit Scores for more information.)

READ the Leas(before it’s time to sign it)

Protect yourself by asking for a copy of the rental agreement to read at your own pace before it’s time to sign. Rental leases are hard enough to understand without the pressure of having someone sitting there waiting for you to sign it. (One lease I read was 34 pages long and took me 4 hours to read!) Getting it ahead of time allows you to research anything you don’t understand, ask questions of the landlord, &/or talk it over with a lawyer or someone who has had more experience.

Apartment lease
Magnifying glass
Caution Light - Don't apply for credit unless you qualify

CAUTION:  If there is something in the lease that they think you might not like, they may not be willing to give it to you ahead of time and/or give you enough time to review it at your own pace.

If that’s how they treat you now when they are probably on their ‘best’ behavior (because they want something from you – a signature & down payment), do you even want to live there to see how they act when they are not on their ‘best’ behavior???  Once you sign, you are stuck.

Digital Clock Timer

Real-Life Story

     A woman I know was once sent an electronic version of an apartment rental contract that came with a count-down timer! When she opened the file, a timer showed at the top of the screen that started counting down from 60 minutes! 

     This woman, thankfully, knew better than to fall for this sales tactic. She quickly read through the lease in the 60 minutes she was given but didn't have time to go back to really understand it. When it disappeared after 60 minutes, she went to the rental office, got a physical copy of the lease, finished reading through it, and then made her decision. I applaud her for standing up for her rights! 

     (In sales this is called a ‘pressure tactic’ – something that makes you believe that if you don’t buy (sign) right away it may be gone and you’ll never get another chance! (That’s not usually the case – they just want you to think it is.) You’ve probably seen them on TV with their “buy within the next 5 minutes to get this great deal” or on Amazon with their “only 2 left in stock” messages. A lease is something that’s going to cost you a lot of money and that you’re going to have to live with for a long time - if you end up hating the terms of the lease, it's going to feel like a LOT longer so don’t fall for any pressure tactics!) 

Understand the Lease – Look For These Items

The items below apply to practically every renter / landlord relationship. Before you sign the lease, look for the answers that will apply to you.

Rent Payment

  • How much is it?

  • When is it due?

  • How often is it due? (most are monthly but not all)

  • How do you pay it? (in-person? via a website? cashier’s check? personal check?)

  • Is there a penalty if it’s late? How much is the penalty?

  • How soon can they evict you if you miss a payment? (some are as little as 5 days!)

  • How often can they raise the rent?

  • Are there any ‘add-on’ fees? (admin fees, service fees, etc.)

Cash in hand

Security Deposit

  • How much is it?

  • What is it for / what does it cover?

  • Is it refundable or non-refundable?



Security Deposit - money that you are required to pay to the landlord / property manager upon signing the lease IN ADDITION TO the rent. 

  • A Refundable Deposit will be given back to you once you move out minus any money owed the landlord for unpaid fees, repairs, the cost of cleaning up of any messes you left, etc.

  • A Non-Refundable Deposit will NOT be returned to you – it’s the same as paying a higher monthly rent except worse. With a non-refundable deposit the landlord gets the money upfront rather than you paying it month-to-month in your rent.  Example: a $1200 NON-refundable deposit is the same as paying an additional $100 / month in rent for a one-year lease.

Lease Term

  • How long is the lease? (are you committing to 6 months? a year? something more? Or is it a month-to-month where either one of you can end it within 30 days?)

  • Does it automatically renew?

  • How much notice do you need to give them if you are planning to move out at the end of the term?

  • How much notice do they have to give YOU if THEY want you to move out? (not evicted – but must move)


  • Do all roommates sign the lease and carry the responsibility or does only one person sign the lease and it’s up to them to manage the others?

  • What happens if your roommate moves out / doesn’t pay their share?

  • Are you allowed to add a roommate after you sign the lease?

Roommates-female-in kitchen
Caution Light - Don't apply for credit unless you qualify

CAUTION:  If you have roommates & they don’t do their part (e.g., provide their share of the rent money), you are most likely still responsible for all the terms of the lease.

Breaking Lease / Subleasing

  • Is there any way you can end the lease early? For example if you get a new job out of state? lose your job & can’t afford the rent? get a permanent change of station (military)? drop out of school (college students)? have a falling out with your roommate?

  • Are you allowed to get someone else to take over the lease (sublease)?


  • Are you allowed any?

  • What kind?

  • How many?

  • What size?

  • Is there an additional security deposit for a pet? Is it refundable or non-refundable?

  • Is the rent higher if you have or get a pet?


  • Are there assigned spaces?

  • How many parking spaces are you allowed to use?

  • Where do visitors park?

  • Is there a limit on visitor parking?

Tow truck with car

Quick Story

     There is an apartment complex in South Carolina where each resident is allowed only 1 visitor parking pass at a time, good for 48 hours, which must be picked up in the office. If a vehicle doesn’t have a visitor pass DISPLAYED (with the correct date on it), the vehicle is towed within a ½ hour. To get it back requires a ride to the tow yard and costs $160 paid in cash. The tow truck driver basically just circles the parking lot and makes a ton of money off them!


     Ask the questions before you sign so you know what you're getting yourself into ahead of time!

Maintenance Problems

  • Who do you contact & how?

  • How long do they have to respond &/or get it fixed?


Bugs / Pests

  • Who is responsible for preventing bedbugs, roaches, ants, mice, etc.? (may be different by pest)

  • Who is responsible for getting rid of bedbugs, roaches, ants, mice, etc.? (may be different by pest)


Keys / Locks

  • Were locks changed / re-keyed / re-coded when the previous residents moved out? If not, is the landlord willing to change them?

  • Can you change them / request they be changed if there is a problem in the future?

  • What happens if you get locked out / lose your key?

Landlord Entry

  • When is the landlord allowed to enter your rental?

  • When do they have to give you advance notice? How much notice?

  • When don’t they have to give you advance notice?

Set of keys on ring
Caution Light

CAUTION:  If door locks were NOT changed then other people may still have keys to your doors – previous tenants or anyone they gave a key to. If this is the case, you can protect yourself with physical devices (see Renting Stage 4 - After You've Signed the Lease for ideas).


  • Are any utilities (electricity, trash, water, gas, internet) included in the rent?

  • Do you pay for utility services through the landlord / property manager or do you set up your own accounts?

Lightbulb - Tip

TIP:  Many property managers have a list of contact information for utility companies that service their properties. To save yourself the time and effort of looking them up, you may want to ask!


  • What insurances are you required to purchase? (renter’s? flood? personal liability? pet liability?)

Amenities (laundry rooms, pool, fitness center, etc.)

  • Is the use of amenities included in the rent?

  • Are guests allowed to use the amenities? Are there fees for guests?

  • Any sort of special access card or code you need?

Smoking / Vaping

  • Are you allowed to smoke inside?

  • Are there designated smoking / non-smoking areas outside?

Work from Home

  • Are you allowed to run a business from your rental? Any specific rules on what type of business? 


Negotiate Any Changes You Desire

If you don’t agree with any portion of the lease, you can try to negotiate with the landlord to change it, you can find a different place to rent, or you could end up doing both. 


Make sure any changes to the lease that you negotiate are 1) written down 2) signed by both you and the landlord and 3) you have a copy of the signed document for your records. Verbal promises are useless if things go wrong. It’s not legal unless it’s written and signed.  

Warning light

Sign the Lease & Get a Copy

⭐ You made it! ⭐  If you understand and are agreeable to the terms of the lease, go ahead and sign it!

Once the rental agreement / lease is signed by everyone involved (you, landlord / property manager, roommate(s)), be sure to get a copy of the COMPLETE (main lease & any addendums), SIGNED version. The copy can be physical or a PDF of the signed version.

Lightbulb - Tip

TIP:  If you make sure you get a copy immediately (physical or emailed to you), it will prevent any possible ‘funny business’ from happening. Unfortunately, there are a few people out there who would be willing to change the wording of the lease somehow to make it better for them. Since we don’t know who those few people are, this tip helps prevent it from happening to you.

What To Do Now

  1. Find your own answers to the Questions for You to Answer.

  2. Review the Most Important Things to Understand.

  3. Continue to Renting Stage 4 – After You've Signed the Lease

  4. Enjoy your new rental home!

  5. Can you think of anyone who might want to know this? If so, please share! 

Learn More

ChatGPT provided the following resources where you can find more specific information:

  1. U.S. Department of Housing and Urban Development (HUD) - Tenants' Rights: Provides information on federal laws governing tenant rights, including fair housing laws, security deposits, and eviction protections. (

  2. Nolo - Tenant Rights, Laws, and Protections: Offers legal information and resources for tenants, including articles on rental agreements, lease terms, and eviction protections. (

  3. State and Local Tenant Rights Organizations: Many states and localities have tenant rights organizations that provide information, resources, and legal assistance to tenants. You can search online for tenant rights organizations in your specific area for local guidance and support.

Learn More (My Sources)

Many rental leases provided to me by friends and family for this research

National Apartment Association - (the source of that 34 page lease!)

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