If you own your home or you’ve been renting so long that this information is old hat to you, consider sharing the details with a young adult or almost adult in your family who would benefit from this knowledge. One of the best ways to pass on your family wealth is to pass on the little things that are second nature to you, but will be a steep learning curve for the next generation.
Number 1: What Will My Total Cost Be and When Is It Due?
You would be surprised how many people sign leases without understanding all of the associated costs and when they must be paid. Renting a new apartment or home is exciting, and it can be easy to gloss over the document and jump straight to the signature line. Most tenants think about obvious costs, such as monthly rent and typical utilities. However, some leases require tenants to pay less obvious costs, such as application fees, credit check fees, parking fees, and optional service fees, such as cable and Internet. Review your lease carefully and compare leases from different landlords–what may seem like a better deal may not be after everything is taken into consideration.
Be sure you know what the deposit is, what will be necessary to get your deposit returned after you move out, when your rent payment is due and what the late fee is if you are even one day late.
Number 2: What Rules and Regulations Will Apply to Me?
Many landlords impose rules on their tenants, particularly those living in close quarters, such as apartment buildings. More common rules include mandatory quiet times, as well as prohibitions on pets or parties. However, other important rules are also found in leases. For example, many landlords prohibit tenants from redecorating their property, from changing locks, from using propane grills and from storing items on balconies. Read the lease carefully to ensure you can abide by each of the rules.
Number 3: When Will My Lease End, and What Happens When It Does?
Many leases define how long they will last (called the “term” of the lease) and under what circumstances they will renew. If the lease does not provide this information, state law will set the term of the lease and its renewal. In some states, the term of a lease is one year if the lease does not say otherwise. However, often, these leases automatically renew if no one cancels. Before you sign a residential lease, make sure you know how long you are locked into it and under what circumstances you can move out and owe no more rent. If you are not sure, consult with your Estate Planning Lawyer(s).
While these are the most critical issues in residential leases, you should always read the lease completely to make sure you understand it. If you are not sure what it means, ask the landlord to explain it to you. You may also wish to discuss a potential lease with your family’s lawyer.
We are our clients’ lawyer for life. If you are ready for a lifetime relationship with a lawyer who can guide you and your family to create more family wealth, not just financial wealth, call to schedule a Family Wealth Planning Session.