First and last month's rent

16 Replies

Just curious who here collects first and last month's rent plus deposit when getting a new tenant? My curiosity is can you evict after missing rent for one month when you techniquely have anoher months rent? Where I have my rentals the judge is pretty fair I hear but Def leans towards tenants even if the law states the obvious sometimes he does what he wants ... What are you reasons for it the double rent? IE your standard practice or for questionable tenants or have you been burnt too many times by tenants.  I wonder if this is the practice how hard it is to get a renter as alot if tenants would have that much disposable cash from my experience, but of course I could be wrong

If rent is $500 a month. Instead of collecting $500 1st months rent. $500 last months rent and $500 security deposit you can collect $500 1st months rent and $1,000 security deposit.

This will limit the tenants stiffing you on the last month.

Originally posted by @Benjamin Mueller :

thanks fellow Ohioan. I get the idea from that aspect but is that a procedure you do with your renters especially over in the Cleveland area??

 It'd be nice to do it all of the time but the market is going to dictate what you can get away with charging.

We do 1 months rent plus $200 as our deposit amount. A little higher than 1 months rent to reduce them stiffing you on the last month but low enough that you don't loose candidates to your competition.

Collecting last month rent early helps ensure they won't stiff you at the end of a long term lease (like 1 year). You're idea may work better in a MTM situation.

As James stated you're going to reduce your tenant pool. It's uncommon here to collect last months rent as well. We take first months pro-rated rent, a security deposit equal to 1 months rent, and any pet fees fi applicable. This can get up to $1800 which is a lot of money to lay down in cash for most people. I think having stricter qualification guidelines will be more effective at getting good tenants that pay than financial requirements. just my .02 cents

This actually just came up for me.  In my area, traditionally only the first month's rent and a security deposit equal to the rent is collected.  That is what I typically do.

However, I recently had a pair of applicants who are moving to the area but are going to find jobs once they get here and live off savings in the meantime.  They do have a good job history where they currently are.  Since I live in a landlord friendly state, I offered to accept them if they would pay first AND last plus security.  I thought that was a more than fair compromise for the additional risk I was taking.  Their response was "thank you, but we have found another place".

I feel like I dodged a  bullet, lol!  If they were supposedly going to be living off savings, then it shouldn't have been an issue to give me first/last/security.  I don't know what place they found or if they even did...but I already thought I was going out on a limb.  I can't imagine someone else renting to them for only security/first when they have no income yet, but apparently there are landlords out there even more lax than I.   

Originally posted by @Jennifer T. :

This actually just came up for me.  In my area, traditionally only the first month's rent and a security deposit equal to the rent is collected.  That is what I typically do.

However, I recently had a pair of applicants who are moving to the area but are going to find jobs once they get here and live off savings in the meantime.  They do have a good job history where they currently are.  Since I live in a landlord friendly state, I offered to accept them if they would pay first AND last plus security.  I thought that was a more than fair compromise for the additional risk I was taking.  Their response was "thank you, but we have found another place".

I feel like I dodged a  bullet, lol!  If they were supposedly going to be living off savings, then it shouldn't have been an issue to give me first/last/security.  I don't know what place they found or if they even did...but I already thought I was going out on a limb.  I can't imagine someone else renting to them for only security/first when they have no income yet, but apparently there are landlords out there even more lax than I.   

 I think you had a good approach. I would be extremely wary of renting to anyone without a job, unless they could show some substantial liquid assets. Always better to send problems down the road to the next guy than be the desperate one stuck with the problem!

Only the market and local laws you operate in will determine if you can get that much in advance money.  I would assume a hot rental market or one that is tenant friendly, so Landlords ask for more.

I agree with @James Wise and make it a higher deposit, if legal in your jurisdiction.

Technically, I was, at times, able to get more deposit then the monthly rental amount because of the combination a security and pet deposits added up to higher than one month's rent.  However, asking for more without a pet would result in the tenant moving on to the next landlord. My market just does not support that business model. A lot of landlords do not accept pets, their pet deposit is non-refundable, or they charge a pet rent. So there is some leverage in getting a nice pet deposit.

First, last, and security are standard in my market. I've never not collected last month up front.

I do nonrefundable $200 cleaning fee and $25 per pet that covers most of the carpet should a pet mess it up.. well at least helps defray the coat of new carpet.. I would be happy putting new carpet in every year or 2 for a couple hundred bucks to keep the place looking spiffy

I meant $50.. I charge $50 because like I tell prospective tenants, I don't really want pets but if they are small I would make an exception maybe for the deposit and extra per month...  plus it's new carpet and they always seem to understand

I used to get 1st and last months rent from anybody without good credit but my lawyer told me it's better to charge a double deposit because the last months rent can only be used to cover the last months rent but the deposit can be used for anything they owe you.

I'm in northeast Ohio {Youngstown area} and was told that it's illegal to collect last month's rent ahead of time.  I can't find anything to back this up.  Has anyone else heard of this?  

Originally posted by @Rachel Bell :

I'm in northeast Ohio {Youngstown area} and was told that it's illegal to collect last month's rent ahead of time.  I can't find anything to back this up.  Has anyone else heard of this?  

 It is not illegal to collect last months rent ahead of time.

What should be noted is that if you collect more than one months rent as a security deposit you need to pay the tenant 5% interest annually on any amount held exceeding one months rent.

always have a separate contract signed for the "SECURITY DEPOSIT", in the contract spell out the this deposit is used for returning the unit to a rent-able condition

such as repairs and anything above normal wear and tear and that it "CANNOT" be used towards any past due owed rent at any time. also state that the tenant will receive security deposit back minus any deductions for repairs within 30 days from move out date. this way you have money to cover repairs and past due utilities if they were not paying them.

works for me and tenants only realize what they signed when they go to stiff you on rent and it holds up in court