Why Doesn’t Anyone Want Prepaid Rent?

giant check

In the last few months, I’ve had several people searching for a rental ask me if they could prepay a year’s rent. So what happened?

First, let’s talk about why they wanted to do that, and the answer is simple–they didn’t meet the landlord’s requirements for renting. As we all know, renting in New York City is hard. One of the toughest requirements for many people to meet is the 40x one month income bar. That means that if the rent is $2000/month, you must earn $80,000.  Now if you a) have been working for a few years in finance b) are a first year law associate at a large firm c) are a professional athlete, you can just shrug your shoulders at that minimum (and by the way, if you are any of those, you probably are not looking at $2000/per month apartments). If, however, you just graduated from college and have a non-paying internship, you’re a full-time student, you’re self-employed with variable income, you work for a start up and have more shares than weekly dollars, you have a working class job, or hey, you are an heir/heiress and you have plenty of savings, but no verifiable emplooymnt or income, well, then it’s a real problem.

Most people deal with this in two ways–they find a roommate (or roommates) whose combined income gets them all over the 40 times income bar, or they get a guarantor (guarantors are usually required to earn 80 times the one months rent). Those options weren’t available to the people I met, so they thought that they could get around the requirements by offering to prepay a year’s rent. And you know what? Most landlords didn’t go for it.

That seems crazy, right? I mean, why wouldn’t a landlord be thrilled to have the one lump sum payment? Wouldn’t it be nice to know they have at least one tenant taken care of, with no late payments, no missed payments, nothing to worry about. Done and done and done. But no deal–almost all of them said they preferred a guarantor, and one said that they would take a prepayment, but the tenant would still have to fill out the application and show some kind of reasonable income. Maybe a small landlord who is renting out shares of their two or three family house would have been willing to do it, or maybe a co-op or condo owner who is subletting might go for it (though the co-op board usually has to review rental applications and they might be as tough as a landlord). But your average building management company? No.

The renters (who both came from out of state and were not used to the obstacle course that is renting in NYC) were completely puzzled by this. One pair eventually scaled down their max rent until it met the requirements, ending up with a much smaller apartment and different neighborhood than they wanted. The other got a guarantor.

But it did make me think a lot about why landlords are so resistant to the prepayment offer. I did a little research, but didn’t find many answers. So here are the best guesses I came up with:

  • The landlord worries that for some reason the tenant will have to break the lease and the landlord will then have to pay back the tenant for the months not used. Landlords do NOT like writing checks to tenants.
  • Management offices just aren’t equipped to handle a tenant whose account is different than everyone else’s. I swear I’ve walked into some management offices that looked like they were straight out of 1994, with ancient computers and overstuffed filing cabinets and the occasional typewriter. I really feel for the poor administrativve staff working in these kind of places. So these places just aren’t cut out for things like “These numbered apartments get a bill every month, and these don’t, and was their lease renewed and they now DO need bills?” It’s not hard to imagine some kind of error happening where the billing department loses track of the fact that the renter has prepaid and starts sending out late notices and late charges to the tenant, creating a mess for both parties. I honestly think that’s the reason why landlords are reluctant to accept prepayment–just to avoid confusion.

    The moral of this story, then, is that if you were hoping to get around a landlord’s income requirements by prepaying, bury those hopes. A guarantor or roommates are still your best bet. And if you have enough cash lying around to prepay a year’s rent on a typically high-priced NYC rental, well, maybe you should see how far you are from a downpayment to buy an apartment…

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Renting An Apartment in New York City–With a Pet

Okay, you have a dog or a cat or you plan to get one (or two–friends are great). That’s great! Life in New York is better with pets. Now how does that complicate your apartment renting experience?

Pet Friendly Buildings – Check Your Lease

Okay, so you found a building that you have been told is pet friendly and you’re ready to sign the lease. MAKE SURE YOU READ THE LEASE. Landlords often use generic leases and some of these have “no pets” written into them. The landlord might not even have noticed this because he (or an assistant) just printed a bunch f standard leases off the Internet without really looking at them. If you see that the lease says “no pets,” point it out, cross it out, and get the landlord to initial it. Better yet, get a pet rider added to your lease. Why is this important? Your current landlord might be okay with pets, but what if the building is sold? The new landlord might not want to have a pet friendly building, or might be looking for ways to get out current tenants so they can renovate your apartment and then rent it out at a higher rate. When the building is sold, the new landlord has to abide by the terms of the leases of the previous landlord. The new owners CANNOT tell you, “This is now a no pet building, either get rid of your pet or get out.” They also can’t start charging you a “pet fee” if your previous lease did not include one. (And for heaven’s sake, make sure you keep copies of your leases!!)

“No Pet” Buildings and the Three Month Law

Now what if you moved into a building that you were told was a no pet building, but you notice that other tenants have dogs or cats? This happened to me. I moved into a no pet building, but then realized that there were clearly a number of dogs in the building–at one count nine dogs in a twenty-four apartment building. The super’s family even had a dog. After a few years of staring longingly at my neighbors’ dogs (my roommate was allergic to cats, so that was out), I wondered why I couldn’t get one too. Luckily I happened to be working with someone who knew a lot about having a pet in New York, and he told me about the “The Three-Month Law” or “Pet Law.”

Officially known as ” Section 27-2009.1 of the Administrative Code of the City of New York,” (read the whole legalese here), this law essentially states that if your landlord or an agent of your landlord (the building super, a doorman, a plumber who comes to fix something in your apartment, etc.) sees that you are “openly and notoriously” (that is, not hiding) keeping a pet, he or she has ninety days to lodge a complaint. If the landlord does not file a complaint within those ninety days, you can keep your pet, free and clear.

Open...

Open…

In order to protect yourself, start accumulating evidence that you are “openly and notoriously” keeping a pet as soon as you adopt your dog or cat. Adoption papers and vet records are a good start, but photographs can really help you out. Put your dog or cat (though really, no one should have any problems with a cat in an apartment–why wouldn’t a landlord want to have help scaring off rodents?) in open and notorious situations, like on your building’s front steps, in front of your apartment door, with neighbors, and photograph him or her. The date stamped photos will provide bullet proof evidence that you are not hiding your pet and that you made it through the ninety days without any complaint.

...and notorious.

…and notorious.

(Of course this is all with the understanding that your pet is well-behaved and not causing a problem with your neighbors. If your dog is anxious and tries to bite people in the elevator, you have a problem. If your dog barks all day while your at work, you have a problem. If you are hoarding thirty cats and the smell is seeping into the hallways or the apartment next door, well, you have a lot of problems. Be a responsible pet owner and make sure your pet is a good neighbor.)

Final Thoughts

  • I will remind you again that the best thing to do is find a pet friendly building. They are out there and I haven’t noticed any difference in the rental rates between no pet and pet friendly buildings. If you have a broker who says that it’s too hard to find a pet friendly building or that there are “hardly any in New York,” find a different broker who understands how important your current or future pet is to you.
  • Don’t let a landlord evict you or try to make you get rid of your pet if you believe you are keeping your pet legally. Just google “NYC pet lawyers” and you’ll find help. Even if you think you can’t afford to hire a high-powered lawyer to take your landlord to court, you still may be able to find someone who will help you. I’ve found that the lawyers who specialize in this area are very willing to help in any way they can, even if it’s just tipping you off to the finer points of a law that might be enough to make your landlord back down.
  • And finally–If you do decide to go the route of bringing a pet into a building that isn’t “officially” pet friendly, then I am begging you with all my heart to please make sure you have a back up plan in case you can’t get your pet through the ninety days. When I decided to take that risk in my first apartment building, I did it with the knowledge that my parents would let my dog or me and my dog live with them until I found a new apartment that would allow me to have her. Please don’t put yourself in a situation where you may have to bring your dog or cat to a shelter. It is sad to see any dog or cat in a shelter; it is twenty times as sad when you look at them and know they have memories of a home where they were loved and don’t understand why they are no longer there.