Budgeting: Major Expenses - Renting a Home

Rental costs should be kept to less than ____ of your total gross income.

• a) 10%

• b) 31%

• c) 43%

• d) 65%

Because the home you rent will probably be your largest monthly expense and where you spend most of your time, it’s important to strike a balance between finding a place where you feel comfortable and one that allows you to stay within your budget.

• True

• False

Just like buying or leasing a vehicle, there are other significant expenses involved in renting a home apart from paying the deposit and the monthly rent.

• True

• False

An apartment that advertises “Pets Welcome” will definitely accept any pet, regardless of species, breed, or size.

• True

• False

It’s a good idea to take photos or a video of an apartment when you first move in, in order to protect yourself against the landlord refusing to return your security deposit when you move out by falsely claiming that you caused certain damages.

• True

• False

You are trying to rent out your 2-bedroom house. Which of these details will you look into for each applicant before narrowing down your choices? More than one answer may be correct

• a) Credit report

• b) Vacation history

• c) Rental history

• d) Employment history

What is the first step you should take when preparing to rent a home?

• a) Check your credit score.

• b) Research where you would like to live.

• c) Create and/or review your budget.

• d) Fill out a rental application.

Marco and Kris have a combined monthly gross income of $7,000. They are looking to rent a home right now. What should their maximum housing expenses per month be, in order to maintain a good housing expense ratio?

• a) $2,170

• b) $2,500

• c) $3,100

• d) $1,750

Clay has a monthly gross income of $5,000. He would like to move out of his parents’ home into an apartment of his own. What should his maximum housing expenses per month be, in order to have an acceptable housing expense ratio?

• a) $725

• b) $875

• c) $1,550

• d) $2,500

It is common practice for landlords to require first and last months’ rent in advance, in addition to an initial security deposit. This means that you may need to provide as much as three months’ worth of rent up front in order to get an apartment.

• True

• False