Moving into a new rental home can be enjoyable, but renters may be surprised by hidden utility costs. As a renter, you need to know what utilities you have to pay for and how much they cost by understanding your rental utilities agreement. A clear rental agreement keeps things from going as planned, helps you stick to your budget, and might even help you find ways to save money every month. Read on to find out everything you need to know about tenant utilities, so when you sign your lease, you can do so with confidence.
What Is a Rental Utilities Agreement?
The section of your lease that tells you how utilities will be taken care of while you rent is called the rental utilities agreement. It tells you which utilities are included in the rent, which are your obligation, and how billing will work.
It is very important to read this part carefully before signing a lease because utility costs can add up quickly. Some utility companies require a deposit up front, which can lead to extra costs that you don’t want. So, understanding your utilities ahead of time will keep you from getting confused and getting bills you didn’t expect.
Common Utilities and Who Usually Pays
Every rental agreement is unique, but most leases will cover a similar set of utilities. For instance, the most common utilities you’ll need include:
- Electricity & Gas
- Water & Sewer
- Trash & Recycling
- Internet & Cable
Depending on the lease and your landlord, you may be asked to sign up for an account directly with the utility company, or you may pay for the utility via your landlord as part of your monthly rent. Situations vary widely, so before you sign the lease, be sure 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. Some common billing methods are:
- Direct Billing: You pay the provider directly, and the bills are in your name.
- Flat Fee: You pay a fixed monthly amount to the landlord for utilities, no matter how much you use them.
- Ratio Utility Billing (RUBS): Costs are divided among tenants based on things like the number of occupants or the size of the unit.
There are pros and cons to each method. You can see your bills right away with direct billing, but you may also need to provide a security deposit up front to start service. There are, however, risks with flat fees. If you use less than usual, they may cost you more.
Hidden Details to Watch in a Rental Utilities Guide
The small print is important when it comes to rental utility agreements. While we may hope that landlords will be upfront about utility costs, some may try to hide information that they want you to miss.
Some deals, for instance, have seasonal rate changes or usage limits that can lead to extra charges. Others might make you split the costs among all the renters, which could result in unfair billing costs.
Still others may charge late payment fees or for reconnecting you if you miss a payment. Before signing your lease, make sure you read it all the way through, including the small print, and ask questions to clarify anything that seems unclear or unusual.
Smart Tips for Managing Tenant Utilities
Not every tenant can change their billing method or the company providing services, but there are still things you can do to help manage your utility costs. Here are some simple techniques:
- Budget ahead: Figure out how much your monthly utility costs and add that to your rent before you sign.
- Save energy: Simple steps like using LED bulbs, sealing drafts, and unplugging electronics can lower expenses.
- Communicate: If you see something wrong with a utility bill or account statement, bring it to your landlord’s attention right away.
- Keep records: Keep your account records and papers in case there are billing issues.
Take Control of Your Utility Costs
Knowing your rental utilities agreement helps you make a good budget and avoid unexpected costs. By recognizing which utilities you’re expected to pay, how the fees are calculated, and what to look out for, you’ll be better prepared to manage your utilities with confidence.
If you have questions about your lease or utility responsibilities for tenants, consult with the local experts at Real Property Management Lakeside right away. We can give you professional advice or help you find your next rental in Davenport.
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