Moving into a new rental home can be exhilarating, but renters may be surprised by hidden utility costs. As a renter, understanding your rental utilities agreement is essential so you know which utilities you have to pay for and how the prices are figured. A clear rental agreement helps you avoid surprises, and can even help you find ways to save money each month. Read on to learn everything you need to know about tenant utilities so you can feel ready and knowledgeable when you sign your lease.
What Is a Rental Utilities Agreement?
A rental utilities agreement is the section of your lease that tells you how utilities will be paid for while you live there. It says which utilities are included in the rent, which ones you have to pay for, and how billing will work.
Utility costs can mount up rapidly, so it’s important to read this part carefully before signing a lease. Some utility companies require a deposit up front, which might add to your costs. Because of this, understanding what your utilities are ahead of time will help you avoid confusion and surprise expenses later on.
Common Utilities and Who Usually Pays
Most leases will cover a similar set of utilities, but each rental agreement is different. For instance, the most common utilities you’ll need include:
- Electricity & Gas
- Water & Sewer
- Trash & Recycling
- Internet & Cable
Your lease and your landlord will tell you if you need to sign up for an account with the utility company, or you may pay for the utility via your landlord as part of your monthly rent. Circumstances vary broadly, so before you sign the lease, it is important to ask your landlord to confirm which utilities renters pay for and which they cover.
Utility Billing Methods Tenants Should Know
How utilities are billed can affect your budget just as much as what’s included. Standard billing methods include:
- Direct Billing: Utilities are in your name, and you pay the provider directly.
- Flat Fee: You pay a fixed monthly amount to the landlord for utilities, no matter how much you use them.
- Ratio Utility Billing (RUBS): Expenses are divided among tenants based on things like the number of people living there or the size of the apartment.
There are pros and cons to each strategy. Direct billing is clear, but you might also have to provide a security deposit up front to start service. Flat rates, on the other hand, are easy to understand, but they could cost you more if you use less than normal.
Hidden Details to Watch in a Rental Utilities Guide
When it comes to rental utilities agreements, the small print is important. While we may expect that landlords will be upfront about utility costs, some may try to hide things that they think you won’t notice.
For instance, some contracts have seasonal rate changes or usage caps that can lead to extra charges. Some landlords may demand that you divide the fees among all tenants, which could result in unfair billing costs.
Still others may charge late payment fees or reconnection fees for missing payments. Read the whole lease carefully, including the tiny print, before signing your lease, and ask questions to clarify anything that seems unclear or uncommon.
Smart Tips for Managing Tenant Utilities
While not every tenant can control their billing method or the company providing services, you can still do a lot to help manage your utility costs. Here are some simple ideas:
- Budget ahead: Estimate monthly utility costs and add them to your rent before signing.
- Save energy: Simple things like utilizing LED bulbs, sealing drafts, and unplugging electronics can lower bills.
- Communicate: if you see something odd on a utility bill or account statement, bring it to your landlord’s attention straight away.
- Keep records: Keep your receipts and account documents in case there are problems with your bills.
Take Control of Your Utility Costs
If you know what your rental utilities agreement says, you may plan your budget better and avoid unexpected costs. You’ll be better prepared to manage your utilities with confidence if you know which utilities you’re expected to pay, how the costs are set up, and what to look out for.
If you have issues about a tenant’s lease or utility responsibilities, call the professionals at Real Property Management Results today. We can give you expert advice or help you find your next rental in Mt. Vernon.
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