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Home
Leasing FAQ (Frequently
Asked Questions) |
This article contains answers to
common home leasing questions. These questions and answers
have been compiled from "real world" leasing
experience in Orange County, CA. Because a lease is a legal
contract, I recommend that you protect yourself by using a
knowledgeable and experienced Realtor to help you through the
process. A Realtor can help you locate the right
property, guide you through all of the paperwork, and ensure a
smooth transaction, free of surprises. I am an area sales and
leasing specialist. Call me today for leases, sales, rentals,
lease-options, lease-to-purchase, and rent to own homes,
anywhere in Orange County,
California. - (949) 290-3263.
| Credit Challenges?
Do you wish to
lease a home but have credit
challenges? Poor credit? Low FICO
scores? A Bankruptcy? Many
people have been through a short sale, job loss,
illness, or other issue that has resulted in financial
hardship and has caused their credit
and FICO scores to deteriorate. It is very difficult
to lease a home in Orange County or anywhere else with
poor credit and low FICO scores. Landlords
may accept a higher security deposit or
several months rent payments in advance, but this
usually doesn't work. The best solution is a co-signer
or lease guarantor. Some people have a
friend or relative who will co-sign for them and in
order to do this, the co-signer will also have to turn
in a credit report and sign the lease. For many people, using a friend or relative is not an option,
as they prefer to keep their financial matters
private.
The solution is a professional
organization that will co-sign for you and
assure the Landlord that they will receive the rent.
They will do this for you for a small, monthly fee. If
this sounds like a solution for you, click the link
below to complete an application:
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Frequently Asked Questions
Latest
| How do I locate suitable homes for
lease? |
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Answer: A real estate agent such as
myself, will work with you to discuss your
needs, provide you with listings, and show you
properties that meet your requirements (price,
size, location, etc). Browsing properties
on-line will help you narrow your search and
come up with a final list of homes for viewing
in person. My home search page
is here and
includes available homes for lease in all
areas of the Saddleback Valley, and South
Orange County, CA. |
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Is
there a cost involved if I use a real estate
agent? |
| Answer: Usually not. The commission
is typically paid to the agent (or agents) by
the landlord, so there is no cost to
you, the prospective tenant. |
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How do
I apply for the lease? |
Answer: Once you have located a
suitable home you will need to:
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1. Fill
out a lease application form. This
is a brief, two-page form that asks
you questions about your employment,
residence history, credit, bank
references, personal references,
number of occupants, pets, and number
of cars.
2. Fill
out an authorization to run your
credit report. The landlord and
his/her agent will need to review your
FICO scores, payment history, debts,
and obligations. Landlords look for
applicants with good credit, and your
application may be rejected for on the
basis of your credit report.
3. You may
also be required to provide things
like a copy of your driver's license,
a tax return, pay stubs, and past
references, although these items are
not usually requested.
Your agent
will provide you with the lease
application and can also arrange to
run your credit report |
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You
showed me a great home for lease but I'd like
to know what else is out there. Let's look
some more. |
| Answer: There is a natural tendency
to always wonder if the" grass is
greener" at the next house, but if you
shop endlessly, you may well lose a perfect
home that you already saw. The lease market
has become very competitive for nice homes.
I'm often finding myself competing against
multiple applications when I submit a tenant's
paperwork. My advice is that if you find the
right home, apply for it and stop looking over
your shoulder. Don't assume the home will
still be available later! |
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You've
shown me some homes in this city. I'd like to
see some homes in these other cities too.
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| Answer: You should really decide
where you want to live before contacting a
Real Estate agent. Drive around each area and
look at homes, schools, parks, shopping,
commuting time, etc. We will be glad to assist
you in this decision by sending you listings
and providing you with information, but we're
not tour guides. Our job is really to help you
find a home for lease in the area of your
choice. All of our expenses (including fuel!)
are our own, so please help us help you by
narrowing down your choices. |
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I have
bad, or less than perfect credit. Should I
tell you before we look at homes? |
| Answer: Yes, definitely! You will
save a lot of time and heartache by doing so!
There is nothing
worse than finding the perfect home, only to
be rejected on the basis of credit. It's
discouraging and a waste of time for both you
and your agent. Credit issues are not fatal,
but they do require special handling on the
part of your agent, who may need to check with
potential landlords before showing you homes.
Don't try to hide your credit issues. The
truth will come out eventually, so allow your
agent to run your credit report right away. Be
up front and let your agent know about credit
issues before you go out to see homes. You
will save a lot of time and your agent will be
in a much better position to locate a lease
home that will accept your application. One
solution is to use a co-signer or lease
guarantor. For a discrete and professional organization
that will do this for you, see the top
of this page or visit my specialty page leasing
with bad credit.
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What forms
will I need to sign once my application is
accepted?
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| Answer:
First, you will sign the lease agreement.
This is the document that spells out all of
the terms and conditions of the lease,
including the monthly rent, late fees, length
of the lease, amount of the deposits, and
other expectations of both the tenant and the
landlord. It is a legally binding
contract, so be sure you read it, understand
it, and agree to all of the terms before you
sign!
You may also be
expected to sign other forms such as agency
disclosures (which describe your agent's
role in representing you with this
transaction), certain state & local area
disclosures, smoke detector and water
heater compliance, mold disclosures, etc.
These are not contracts in the usual sense -
Just legally required documents that tell you
things you might want to know about the area,
the home, the neighborhood, etc.
Last, before
you move in, your agent will accompany you on
a thorough inspection of the home and will
help you complete a move-in inspection document.
This form protects both you and the landlord
by noting all existing damage or items needing
repair, and ensures that you will not be
charged for any existing damage to the home
later, after you move out. |
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Can I
negotiate the lease cost (monthly rent)? |
| Answer: Yes, you may negotiate
the monthly rent or any of the other cost
(deposits, utilities, etc). This is not to say
that you will always be successful, but it's
certainly worth a try. See my entire article can
you negotiate a lease? here. |
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Can I
change the length of the lease? |
| Answer:
Some landlords may
agree to a shorter or longer lease
term under certain circumstances. Most
leases are for 1 year. This is usually
the most desirable situation for the
landlord, plus it gives you a full
year of a guaranteed monthly rent
without a rent increase. If a Landlord
does agree to a shorter term (6 month
leases are common) he/she may ask for
a rent increase to compensate for the
shorter term.
On the flip side, you may be
able to get a lower monthly rent by
signing a longer lease. If you
want a lease that's less than 1 year,
be prepared to look at several
properties until you find one that
will agree to the shorter term. An
agent with experience in negotiating
leases such as myself, can assist you
in negotiating the terms of the
lease.
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What are
my total costs to move in? |
| Answer:
Typical costs include
first month's rent and a security deposit, but
may also include a pet deposit, key deposit,
or other charges. The total amount to move in
should be clearly spelled out to you by your
agent, plus it will be printed on page one of
the lease agreement. You will normally
need to provide a cashier's check at the time
that you sign your lease. |
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How is the
security deposit calculated?
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Answer:
There is no set rule on how the security
deposit is calculated - Landlords set this
amount arbitrarily. However, there is a maximum
amount that they are legally allowed to
charge, as follows
1. A maximum
security deposit equal to two months rent
for an unfurnished home
2. A maximum
security deposit equal to three months rent
if the home is furnished
Usually the security
deposit is less than two months rent, but the
actual amount may vary. Be aware that there
may also be additional deposits if you have
pets, plus the landlord may charge for keys,
remote controls, etc. All of these deposits
are perfectly legal and fully refundable, as
long as the home and all property are returned
in good condition. |
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Do I have
to pay the security deposit up front? Can I
break it up into two payments?
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| Answer:
I get this question a lot and with few
exceptions, the answer is "Yes" and
"No". Think about it this way. If
you were selling something and a potential
buyer said "please don't sell it to
anyone else. I'll pay you in a month".
Would you do it? Most likely not. What
guarantee would you have that the buyer would
come through? And would you want to turn down
other buyers during that month? Of course not.
The same goes for leasing a home. The security
deposit reserves the home for you and gives
the landlord the security to be able to take
the home off the market. You must pay the
security deposit up front, even if you are not
moving in for a month.
Splitting the
deposit? Don't ask!. It's a sure sign that you
really can't afford to lease the property. |
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Will I be
dividing monthly expenses like utilities and
lawn maintenance with the landlord? |
| Answer:
Usually
you will pay for all of your own utilities
(including water) while the landlord pays for
items like gardening service, pool
maintenance, and homeowners association dues.
While this is a typical breakdown, it may vary
somewhat for each lease. For example, water
and lawn maintenance may be paid for by the
association (and therefore, the landlord) in a
condominium complex. The
tenant/landlord breakdown of all monthly
expenses must be clearly stated in the lease
agreement, so you should take extra care to
read this section of the lease contract
carefully.
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Can I
make changes to the home? |
| This is a very common question.
Many tenants want to paint a room, add a
doggie door, install a child-safe pool fence,
etc. The most important thing to understand is
that any changes to the home must be
approved by the landlord. When requesting
changes, always follow these guidelines:
1. Discuss the
change with the landlord and get agreement
in writing (e-mails may suffice). If you
know beforehand that you are going to want
changes to the home, have your agent write it
up as part of a lease contract addendum.
Otherwise, get permission from the landlord in
writing.
2. Be sure to
go over all plans with the landlord, including
paint samples, plan diagrams, holes that will
need to be drilled, etc.
3. Discuss
who is paying for it. Some landlords are
OK with paint or modifications if the tenant
pays for it. For larger modifications or
improvements, the landlord may wish to share
in the cost (or pay all of it) since he/she
may be the long term beneficiary of the
change.
4. Unless you
are a skilled contractor, get all work done
by professionals. Amateur paint jobs and
do-it-yourself carpentry are a
"no-no", and you are asking for
trouble later, when the landlord docks your
deposit because of sub-standard work.
5. Keep good
records. Save all letters, e-mails, and
invoices in your "lease file". Good
documentation will help you avoid
misunderstandings or disputes later.
6. Last, and
very important. Make sure you and the
landlord have a written agreement on what will
happen with the change(s) when you leave. For
example, are your paint colors staying on the
walls or will you have to re-paint? Is the new
pool fence remaining in place? Make sure you
are on the same page regarding the "exit
strategy". |
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Will I
need insurance or am I covered by the
landlord's policy? |
| Answer:
You should take out a Renter's Insurance
Policy. In most
cases, a landlord's insurance covers only
structural damage to the building itself—and
many landlord policies don't even go that far
if the damage is caused by a tenant. A
Renter's Insurance Policy is reasonably
affordable and will protect your furniture and
personal belongings in case of fire, theft,
vandalism, floods, etc. It also provides you
with liability coverage in case of accidental
damage or injury to persons. For example,
don't assume that the landlord's insurance
will cover all of the repairs when your 100
gallon salt water aquarium suddenly springs a
leak. You may wind up being liable for much of
the damage! Get a renter's policy. |
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Can the
landlord enter the home? |
| Answer:
Yes, but only for emergencies. For example,
suppose you are renting a condo, and a bathtub
overflows in the condo above yours. The
landlord could check your unit for water
damage even if you were not home.
The landlord
can enter your home for certain other reasons
as well, but only after giving you a 24-hour
written notice and only during normal
business hours. For example, if you plan
to move, the landlord has a right to show the
apartment or house to prospective tenants. Or,
the landlord might want an electrician to
check the wiring.
The landlord
must give you a 48-hour written notice to make
a pre-vacancy inspection of your unit. |
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Who will
be responsible for repairs? |
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The landlord has the
responsibility of keeping the home in
good condition, so repairs and
maintenance of the structure,
appliances, air conditioning system,
plumbing, etc are the responsibility
of the owner. However, if a specific
problem is caused by the tenant, then
the tenant is responsible for getting
it repaired and for paying the bill.
For example, if your child breaks a
window in the home, you are
responsible for replacing the window,
not the landlord. Sometimes it's a
fine line. A leaky faucet is the
responsibility of the landlord, but if
you (the tenant) clog a sink, get it
fixed yourself - don't call the
landlord. |
Notify the
landlord promptly regarding any needed repair,
and never order a repair without his/her
permission. Always allow the landlord to
choose the repair company and order the
repairs. |
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My lease
is almost up. Can I extend it? |
| Answer:
Most lease agreements allow for an automatic
month-to-month tenancy following the
expiration of the lease (typically after the
first year). In effect, the lease reverts to a
"rental". While you might
appreciate the fact that you are no longer
locked into a lease, there are certain
disadvantages as well. The first is that your
landlord could terminate your agreement with
only a month's notice, in which case you would
have to leave (in haste). The second is that
you are no longer assured of stable rent for a
year. The landlord could theoretically
increase the rent each month. Because of these
things, many people prefer to negotiate a new
lease with the landlord rather than continuing
with a month-to-month rental arrangement. |
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Can I
break the lease ?
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Answer:
If your landlord fails to hold up his end of
the lease agreement, you may have legitimate
grounds to terminate the lease. Otherwise,
remember that when you sign a lease you are
signing a legally binding contract. Therefore,
this question cannot be answered with a simple
"yes" or "no", as there
are numerous legal and financial
ramifications. Things happen however, and
sometimes a job transfer, illness, or
financial circumstance forces your early
termination of a lease. Unfortunately the
subject is too complex to be covered here, so
I will refer you to the following articles as
a starting point. If in doubt, get legal
advice from a qualified attorney.
Breaking
a Rental Lease (MSN Real
Estate)
Can
I break a lease to take a new job?
(Consumer Law Center)
Renter's
guide: how to break a lease (eSortment)
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When will
I get my deposit back and will there be any
deductions? |
Answer:
Your security deposits are fully refundable,
and must be returned to you within 3 weeks of
leaving the home, as long as:
1. The home is
returned to the landlord in the condition it
was when you took possession (allowing for
normal wear and tear)
2. All keys,
remotes, and similar items are returned.
3. There are no
unpaid late fees or rents.
4. You have
fulfilled all of your contractual
obligations (e.g., getting the rugs
shampooed after you leave)
The landlord
will inspect the property when it is vacant
and may take deductions from your deposit, if
warranted. All deductions must be justified
with proper documentation, and must include
reasonable estimates for repairs or
replacement of lost items, in writing.
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In the event of a claim by
the landlord, don't assume that your
deposit will cover everything! It is a
widely-held myth that the landlord
cannot charge you more than the amount
of your deposit. WRONG! In fact,
your lease contract typically states
that you are financially responsible
for damage, lost items, cleaning,
delinquent charges, etc., regardless
of whether the amount exceeds the
amount of the security deposit. |
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Don't
you get paid to show us homes?
Answer:
Regrettably
no, wish we did! All of our expenses including car,
gas, etc., are paid by us, and we only get paid if
we complete a lease! This is why we are a little
more thorough in making sure you are serious and
qualified for a lease before taking on any
showings.
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Top
I
am looking at homes with you this afternoon and then
later, at others with different agent
Answer:
While
we work with you. we ask that you work with us exclusively.
We work very hard for you and expect that you
will reciprocate
by showing your loyalty to us and understanding that
we cannot get paid unless we complete a lease.
Showing homes to you while you are working with
other agents means that we often work for nothing!
We will refuse to work with clients who expect us to
do
this!
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Top
Is
it possible to buy the home after we lease it?
Answer:
Maybe.
It really depends on whether the landlord is
interested in selling. You can always contact the
landlord and ask. A lease-option is a possible
solution. For information on lease-options,
please visit my page here: http://www.ronforhomes.com/leaseoption.htm Back to
Top How
soon should I be looking for a lease? Answer:
The
lead time is 30 to 45 days, maximum. It is
unproductive to see homes if you are leasing further
into the future because the landlords and their
agents will not reserve a home for you more than 30
days in advance. Back to
Top We
are looking to lease but have two dogs. Where shall
we look?
Answer:
The
best source is my "pet-friendly" lease
page here: Pet
leases
Back to
Top Can
we ask for a lower monthly rent?
Answer:
Possibly.
Many landlords are willing to do some negotiating.
Just keep it reasonable. For example,
I have had some clients who have asked me to submit
an offer far lower than the asking rent ($1,000,
$1,500, or more). Tenants do need to realize that
the home owner (landlord) does have expenses like a
mortgage payment, property taxes, HOA dues,
gardener, etc. Because of this, there is a limit to
what you can realistically expect.
Also,
if you have poor credit, please don't ask for a rent
reduction! The challenge will generally be to get
you accepted for the lease. Asking for additional
concessions like a rent reduction will surely get
you rejected! For more on negotiating a lease, see
my page here: Can
you negotiate a lease?
Back to
Top On
what basis can I be rejected for a lease? Answer:
Only
for a few reasons including pets, smoking, water
filled furniture, etc, but largely on the basis of financials.
You cannot be legally rejected on race, religion,
marital status, political leanings, and other
personal matters. "Financials" may be a
fairly broad brush however and may include items
such as your credit, FICO scores, employment
history, income, past rent payments, bankruptcies,
past landlord references, etc. In California, a
landlord does have the right to know that you are
qualified for the lease and that you have the
financial wherewithal to make the monthly rent
payments. They can legally request documentation to
ensure that they are satisfied in this regard. Also,
they may choose not to accept you if you have pets,
if you are a smoker, or have a water bed (i.e., they
have the right to ensure that their property is kept
clean and undamaged and they are allowed to specify
these preferences).
Back to
Top How
many homes can we see? Answer:
For
practical purposes, we try to keep it to five to
seven homes, maximum. We will always send you
listings by e-mail of many homes for lease. It is
really your job to browse these listings and select
a cross-section of homes for viewing. If none of
them fit or if they have the wrong criteria, we will
be glad to correct this and send you a new set.
Almost all of the listings have photographs and
descriptions that should help a potential tenant
decide if this is a home they would like to see.
When clients want to see more homes after a viewing,
they have usually failed to correctly outline their
preferences or they may be shopping in the wrong
price range.
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Top
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Related
links:
I hope
this article has answered some of your questions
about home leasing. Do you have a question about
leasing that was not addressed here? Please feel
free to contact me! I am very experienced with
leases and will be happy to help you find a lease,
rental, option, or home for sale in South Orange
County, California, including Coto de Caza, Dove
Canyon, Rancho Santa Margarita, Mission Viejo,
Ladera Ranch, Las Flores, Rancho Cielo, Walden,
Wagon Wheel, Laguna Niguel, Robinson Ranch, Foothill
Ranch, Portola Hills, or the Canyon areas (Modjeska,
Silverado and Trabuco Canyons).
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