When Renting an Apartment Does One Always Have to Put a Down Payment?

When Renting an Apartment Does One Always Have to Put a Down Payment?
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When you think of a down payment, you typically associate it with buying a house. However, if you’re moving into a rental, you’ll pay something similar to that, only an apartment down payment is usually in the form of security deposits and move-in fees. You’ll likely be unable to get out of this type of a down payment on an apartment unless you can find a move-in special or negotiate with the landlord.


  • You'll pay something similar to a down payment when you move into an apartment. Typically, you'll pay security deposits and move-in fees.

Cost of Apartment Down Payment

If you’re preparing to move into your first apartment, you’ll probably want to know what you can expect to pay up front. In addition to the other costs you run through your first apartment budget calculator, you should include application fees and something called a security deposit, which many property owners charge to protect themselves in case you cause enormous damage to your apartment or suddenly skip town.

Typically, you’ll be asked to pay the equivalent of the first month’s rent as a security deposit, with the assurance that it will be returned at move-out, provided everything passes inspection. In some states, though, the law limits how much landlords can charge. Most states limit it to one or two months’ rent, but in New Hampshire, they can only charge up to $100.

Down Payment Versus Deposit

You may call your deposit a down payment when making out your first apartment budget worksheet, but it’s actually quite different from the down payment you’ll pay when buying a house. When you buy a house, you’ll need to have a percentage of the total house price, usually costing you tens of thousands of dollars. This money reduces the amount you’re borrowing from the lender and will not be repaid when you move out.

A deposit is merely a protection for the property owner. You’ll pay a similar damage protection deposit if you rent a vacation home or vehicle. Since it’s generally only the first one or two months’ rent, it’s likely to be in the low thousands of dollars. You should be able to get information on security deposits from apartment complexes when you call, but it can vary from one landlord to another. With home buying deposits, on the other hand, you can usually get a general idea that will apply to whatever house you buy.

Paying Rent in Advance

In addition to a security deposit, your landlord may require that you pay the first month’s rent in advance. This is in addition to the many other first-month expenses you’ll have to pay at move-in, including the first month of all your utilities. It’s important as you’re putting numbers into your first apartment budget calculator that you make sure you have enough set aside to pay all of this before you even get your keys.

Another cost you may see in more competitive rental markets is a move-in fee. This is in addition to your security deposit and is a fee designed to cover the costs to make your apartment move-in ready. This includes touch-ups and upgrades. Your landlord may put a fresh coat of paint on your walls, for instance, and use the move-in fee to cover it.

Understanding Pet Deposits

A security deposit isn’t the only move-in expense you’ll have. If you have pets, a landlord will likely require an up-front fee for your furry friend. Don’t get clever and try to sneak Fido in, either. Your lease will likely include hefty penalties and possible eviction if you’re caught with an unregistered pet.

As with a security deposit, the cost of your pet deposit can vary from one landlord to another. State laws may also restrict how much your landlord can charge for this. Typically, you’ll find this deposit is in the hundreds of dollars, but you may also find that some landlords require no up-front fee for pets, instead adding an extra $50 or more each month to your rent.

Finding Move-In Specials

One of the best ways to get out of an apartment down payment – or at least drop it down a little – is to look for a move-in special. If you’re in a market where competition for every unit is fierce, those deals may not be as easy to find. But you can conduct price-comparison research online and possibly even work with an apartment locator service to help you find a unit that meets your needs that also has current deals.

If you see a move-in special at one apartment complex but you would actually prefer another, don’t be shy about picking up the phone and asking. Some apartments may be willing to discount the security deposit in order to get your business. This is especially true if you find a complex with empty units they’re having trouble keeping rented.

Renting With Poor Credit

Any landlord wants to know that you’ll pay your rent on time every month. For that reason, a credit check is likely to be part of qualifying for a new apartment. The first thing you should do before you start your apartment hunt is pull a copy of your credit report and make sure the information is correct. You can dispute any inaccuracies and possibly boost your credit score in a matter of weeks.

Even if you have a low score, though, you can still find an apartment. It may mean going with an individual landlord renting a home or unit inside a house, though, rather than choosing a commercialized apartment complex. That option may be better for your first apartment budget calculator anyway since you’ll often get a better deal through an individual than an apartment complex.

Other Move-In Deposits

If you’re putting together a first apartment budget worksheet, it’s important to include a list of all the expenses associated with renting an apartment. First, there are the costs of moving your belongings from one place to another, which won’t be cheap even if you plan to do the actual lifting and hauling yourself. You can cut down on these by borrowing a friend’s truck and looking online for someone locally who is giving away used moving boxes.

Even with that, though, there will be deposits associated with hooking up your utilities. If you don’t already have an account in your name with the electric, water and cable companies, you may find they require you to pay a deposit to get those services started. Your apartment complex may also charge fees for your mailbox keys or parking.

Getting Your Deposit Back

As you’re writing out your first apartment budget worksheet, it can be easy to think short-term and forget that you’ll get that deposit back when you move out. In fact, one survey found that more than one-quarter of renters have lost all or part of a security deposit when leaving an apartment.

To boost your chances of getting that money back, here are some things you can do:

  • Read your lease and make sure you know what’s expected of you in order to get your deposit back.
  • Stay for the full term of your lease. Your landlord can keep your deposit if you break your lease. You should also provide plenty of notice that you’re leaving.
  • Thoroughly clean your apartment.
  • Double check all cabinets and closets to make sure you aren’t leaving anything behind that will have to be removed.
  • Have a friend walk through the unit to make sure you aren’t missing anything that could cost you.
  • Ask to be present during the final walk-through and sign off on any issues your landlord finds.
  • Return all keys to your landlord to avoid having the expenses to make new copies deducted from your deposit.