Moving into a new apartment does not come cheap. Redfin reports that the national median rent now exceeds $2,000. Forbes writes that the average long-distance move costs as much as $5,700. Considering your deposit, application fees, pet deposit, first and last month of rent, and relocation expenses, your all-in cost to get into a new apartment could exceed $7,700.
To reduce your total moving and renting costs, you might consider a “no deposit” lease. So, what does “no deposit” mean? It’s simple: you sign a lease to rent an apartment without needing to park cash with your landlord upfront. The basic concept is straightforward, but there are some details that you need to know.
With traditional leases, landlords require tenants to pay a security deposit upfront. A security deposit is money your landlord holds onto in case you cause any damage to the rental property. Typically, a deposit costs the same as one month of rent.
Some landlords ask renters to pay the first and last month of rent upfront, too. For example, a $2,000 per month apartment could charge a $2,000 deposit plus $4,000 for the first and last month to total $6,000 out-of-pocket before moving in. That is a lot of money to spend in a lump sum, especially when you could use your saved cash to help you settle in, buy furniture, and cover other relocation expenses like travel and food.
Not all “no deposit” solutions are the same. Different options use different approaches, but they all follow a general pattern. Tenants pay less cash at move-in time and landlords retain financial coverage. However, it is important to know the details. In some cases, landlords are not fully protected against damages. In others, tenants could pay more fees than the total cost of a regular deposit.
One popular approach is to offer insurance instead of a deposit. Landlords collect a monthly fee and tenants benefit from no upfront deposit. However, depending on the length of the lease, the monthly fees may add up to cost more than a regular deposit would. For example, a $50 fee paid every month for 2 years costs $1,200 when some communities offer deposits as low as $300 to $500 for comparable rents. If a landlord makes a claim, the process may be prolonged. Any repairs requiring immediate attention would need to paid out-of-pocket, which is often the case when a property team needs to quickly prepare a unit for a new lease.
A simpler option is breaking up a regular deposit into monthly installments. Tenants effectively move in now and pay later. Landlords remain fully covered. It’s a win-win, and it’s exactly how Safely Finance works. There is no claims process. Landlords receive 100% of the deposit cash upfront before the lease begins. Renters pay-over-time for as low as 0% APR with no fees. Landlords sleep easy knowing the property is fully protected. Plus, tenants build credit history and can boost their credit score for making payments on time.
No deposit offers may vary. With Safely Finance, any customer with a demonstrated ability to pay back the loan can rent without an upfront deposit. Many of our customers are relocating to take a dream job or move into a dream apartment. You can see your offers for a no deposit move in here.
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