Everything You Need to Know About First and Last Month’s Rent


Apartment for rent sign
iStock.com/dcsliminky

Getting into an apartment often requires more than searching for rental listings, choosing one, applying and getting approved. You must also demonstrate your ability to pay for the unit by paying the upfront fee which takes the unit off the market and secures it in your name. A common upfront cost is first and last month rent, and what you pay may depend on your landlord or property manager and the city and state in which you live.

Learn everything you need to know about paying your first and last month’s rent, what your landlord or property manager is used for, how it differs from a security deposit, and the pros and cons of living in a rental. which requires the first and last month’s rent up front.

Why do you have to pay the first and last month’s rent?

While not all landlords or properties charge prospective tenants the first and last month’s rent, some do so to guarantee payment for the last month of your lease. On the other hand, you may need to pay a security deposit to take the unit off the market and secure your place in the unit.

What are the rents for the first and last month used for?

Your landlord or property manager can use last month’s rent as a security deposit, which means they can use that money to pay for any damage to the apartment after you move out. If so, you will get the remaining balance of that deposit back. However, if there is no damage to pay, you will get the full security deposit back.

They can also collect your last month’s rent and apply it to your last month’s lease balance so you don’t have to pay. Some property owners and managers use the security deposit as their last month’s rent, which means they can only use it for that and not for repairs after you move. In this case, the owner or property will have to pay these expenses, not you or your security deposit / last month’s rent.

Check your lease and review the purpose of your upfront payments to make sure you understand what you’re paying and what they’re going to use it for.

Is the rent for the first and last month the same as a security deposit?

The rent for the first and last month is different from a security deposit. Security deposits can only be used for:

  • Pay to repair damage to the unit suffered during the tenant’s lease
  • OR to pay only the last month’s rent

The rent for the first and last month is used to:

  • Pay the tenant’s first and last month’s rent before moving in and before or when moving
  • Start and end the tenant’s lease

Advantages and disadvantages of renting apartments that receive first and last month rent

While paying a lot of money up front for a home might not seem like a good thing at first, there are some advantages to choosing a rental property that requires the first and last month’s rent. These benefits include:

  • Places that require first and last month rent tend to value unit maintenance, which means they’re likely nice, well-maintained places to live.
  • There may be fewer applicants to compete for a unit than usual due to the higher upfront costs.
  • If you live in a state where owners and properties must place the security deposit in a special account, such as a savings or escrow account, you will earn interest on that deposit and may get more than you have. reimbursed, depending on the length of your life. in unity. This means that you technically only pay the first and last month’s rent since you’ll get your deposit back and can use it to rent elsewhere.

However, there are also a few drawbacks to consider:

  • You pay two full months’ rent to move in, which may be too expensive for some tenants. If you have to pay a security deposit on top of the first and last, you will likely have to pay three months’ rent.
  • A location that demands first and last – or even first, last, and a security deposit – in an area where it’s not common for owners and properties to do so may be out of your price range.

Frequently Asked Questions About Upfront Costs

Here are some additional FAQs and answers to help you fully understand first and last month rent:

What does the first month’s rent cover?

The first month’s rent is used for:

  • Pay the balance of the first month of rental
  • Fully secure the tenant in the lease and the unit

Do you have to pay rent in the last month of your lease?

If your landlord collected last month’s rent as part of your upfront costs, you usually don’t have to pay rent in the last month of your lease. This is because this money is meant to be applied to those dues whether or not you stay until the end of your lease.

However, if you have paid a security deposit, check your rental agreement and contact your landlord to see if the deposit should be used to repair damage after your move or to cover last month’s rent.

Do you collect last month’s rent at the end of your lease?

If you prepaid last month’s rent, you won’t get it back at the end of your lease. This is because the landlord has to apply this money to your last month’s rental costs.

Do you still have to pay the first and last month’s rent?

No, you don’t always have to pay the first and last month’s rent. Your landlord or property manager determines the type and amount of upfront fees you pay.

Having a stable income to pay for an entire lease is only part of the rental formula. Many property owners and managers charge some form of upfront fee and even a mix of first month’s rent, last month’s rent, and a security deposit to secure their investment in your lease. Always review your lease to understand your upfront costs so you know what you’re paying and why.