Renting your first U.S. apartment and avoiding rental scams

Step 1 — Plan your budget and the money you need up front

Landlords may ask for pay stubs or other documents to check your income, and some reject applicants when the rent is more than 30% of their gross (before-tax) monthly income (HUD — Housing Counselors Training).

Then add up what you pay before you move in. HUD lists these upfront costs (HUD):

• an application or credit report fee;
• a security deposit: a lump sum usually paid when you sign the lease, which the landlord gives back at the end if you haven’t damaged the home or broken the lease;
• the first month’s rent, and possibly the last month’s rent;
• moving costs, and fees to connect utilities (electricity, gas, water) in your name.

Individual landlords may be more likely than management companies to waive or lower some of these costs (HUD). You’ll also need a way to pay rent; see our guide to opening a bank account.

Step 2 — Search and visit: check that the listing is real

This is the stage where rental listing scams appear. Scammers copy the photos and description of a real listing and put their own contact details on it, or they advertise homes that aren’t for rent or don’t exist (FTC — Rental Listing Scams).

Before you pay anything, the FTC suggests (FTC):

• Search the address together with the owner’s or company’s name. If other ads show the same address with a different owner, that’s a sign of a scam. Check that the home also appears on the rental company’s own website.
• Search the name of the owner or company with words like “complaint”, “review” or “scam”.
• See the home before you sign or pay: in person, through a friend, or by video or virtual tour. Even that is no guarantee; scammers may use a self-guided tour to look real.
• Check who owns it. City or county tax assessment websites show a property’s owner. If you meet an agent, ask for a business card from the company that owns or manages the property and check that their ID matches.

Red flags: the “owner” says they’re out of the country, the rent is surprisingly low, or the home is listed for sale instead of for rent. If anyone pushes you to decide quickly, walk away (FTC). Need a short stay first? For vacation rentals, the FTC says to get a copy of the contract before you send any deposit (FTC).

Step 3 — Apply: what landlords check, and your rights

Landlords use a tenant screening report (a background check from a specialized company) to decide whether to rent to you and how much deposit to charge (CFPB). It may cover your past addresses, work and income history, credit and payment history, housing court records, criminal records and bankruptcies (FTC — Tenant Background Checks).

Protect yourself at this stage:

• Before you pay an application fee, ask what information the landlord uses to decide (FTC). If you don’t have a U.S. credit history or a Social Security number yet, ask now what they accept instead.
• Guard sensitive details. Until you’ve agreed to rent a place, a landlord doesn’t need your Social Security number, credit score or other sensitive information; most landlords pull your credit themselves. Never give personal or financial information to someone who contacts you claiming to work with the owner; contact the owner or company yourself (FTC — Rental Listing Scams).

If you’re turned down. If a landlord denies you because of a screening report, or because of it approves you only with a co-signer (a person who signs with you and promises to pay if you don’t), a bigger deposit or higher rent, the landlord must tell you. This is called an “adverse action notice” (CFPB). It must give the screening company’s contact details, your right to a free copy of the report if you ask within 60 days, and your right to dispute wrong information (CFPB). If the notice is only spoken, ask for it in writing (FTC). The company generally has 30 days to investigate a dispute, sometimes 45 (CFPB).

Step 4 — If you have no U.S. credit or rental history

Most tenant screening companies won’t have information on you until you apply for a rental or authorize a landlord to get a report (CFPB).

HUD’s counselor training says landlords may hesitate when an applicant has no rental history. It suggests offering proof that you’d be a responsible tenant: a reference from a landlord you had no disputes with, a letter from someone you lived with and paid rent to, or a letter from a housing counselor confirming you completed tenancy counseling (HUD). If your past landlords are abroad, ask whether a reference from them will be accepted.

A HUD-approved housing counselor can advise you on renting and credit (CFPB). Our guide to building credit from scratch explains how to start.

Step 5 — Know your fair housing rights

The Fair Housing Act, a federal law, bans housing discrimination because of race, color, national origin, religion, sex, familial status or disability (HUD). It applies to nearly all housing, including private rentals (HUD). National origin discrimination can be based on the country where you were born or where your ancestors came from, and “familial status” covers families with children under 18 (DOJ).

Discrimination isn’t always open. The Justice Department notes that some housing providers disguise it by falsely saying nothing is available, or by steering people to certain areas (DOJ).

If you think it happened to you:

• Note the date, the address, who was involved and what happened; HUD asks for these details (HUD — Report Housing Discrimination). Keep ads, texts and emails.
• Report it to HUD online or at 1-800-669-9777. There are time limits, so report as soon as possible (HUD).
• You can also file your own lawsuit in federal or state court (DOJ).
• Retaliating against someone for reporting discrimination is illegal (HUD).

HUD says it now prioritizes cases with “actual, provable instances of discrimination” (HUD), so keep good records.

Step 6 — Read the lease before you sign

A lease legally binds you to pay rent for the whole lease period (HUD). HUD suggests that you (HUD):

• ask for a written lease; a spoken one relies on memory and can lead to arguments;
• understand every condition and make sure no spaces are left blank;
• get every promise the landlord makes in writing;
• check the lease term and key dates, such as when rent is due;
• avoid a lease that runs longer than your guaranteed job.

Many disputes start because tenants didn’t understand the rules on rent, fees, utilities, guests, pets, parking, repairs or noise (HUD). Keep a signed copy. Leaving early can cost you money, and the rules depend on your lease and your state (HUD).

Older buildings. For most housing built before 1978, federal law requires the landlord, before you sign, to give you a lead hazard pamphlet, tell you about any known lead-based paint, and include a lead warning statement. It doesn’t apply to short leases of 100 days or less that can’t be renewed (EPA).

Step 7 — Pay safely, inspect, and protect your deposit

• Pay in a way you can trace. The FTC warns that wiring money, sending gift cards or paying with cryptocurrency is the same as sending cash (FTC). Ask for a receipt for every payment.
• Inspect before you move in. HUD suggests an inspection before you move in and another when you move out; its sample checklist goes room by room (floors, walls, windows, locks, outlets, fire alarms) (HUD). Take dated photos, and ask the landlord to sign your list too.
• Know how the deposit works. In HUD’s sample lease, the landlord can deduct unpaid rent, cleaning, key replacement and damage beyond ordinary wear and tear, with a written list of charges (HUD). The actual deposit rules differ by state, so check your state’s tenant resources (see below).
• Consider renters insurance. It generally covers your belongings against risks such as fire, smoke, theft, vandalism and water, but usually not floods or earthquakes, and a landlord may require it (HUD).