Living with roommates can be tricky at any age, but the process tends to be particularly fraught for the fresh-out-of-college crowd simultaneously navigating the etiquette of adult roommating and all the legal responsibilities it entails. Below, five logistical (and legal) hassles to consider ahead of time to save yourself—and your roommates—from major headaches down the road:
You're legally responsible for the entire apartment's rent
Make no mistake, this is the big one. If your roommate falls behind on the rent, moves out, or for any other reason stops paying, you're legally liable for the entire rent, not just your portion, as long as your name is on the lease. "Each person is liable for any and all of the unpaid rent," says Charles Schoenau, managing director at Insurent, and institutional guarantor (and FYI, a Brick sponsor). "I tell that to people relentlessly."
"When you're signing on, you're not signing on as individually liable people 'Joe, Mary, and John,'" concurs Citi Habitats agent Angel Guzman. "You're signing on as the entirety of 'Unit 5D'."
For this reason, some experts recommend signing separate "roommate agreements" when you move in, outlining what each person is responsible for. (More details on that here.) The landlord will still be able to come after you in the event someone else stops paying, but having a written agreement gives you some legal recourse if you find you have to sue one of your roommates for unpaid rent down the road. It's not a guarantee, but can add extra weight to your complaint in small claims court by showing that your roommate explicitly took responsibility for a certain portion of the rent. To avoid getting to this point, you can also ask the landlord for monthly receipts, along with other steps to ensure that everyone is paying their due every month.
If your parents are guarantors, they're not just covering you
Along the same lines, if you're asking your parent to step in as a guarantors, it's important that everyone understands that they'll be held responsible for the entire apartment, not just your individual share. "You're guaranteeing the full rent amount—almost everybody has misconceptions about that," says Shoenau. "It doesn't matter who defaulted, everyone is liable."
"Guarantors often don't understand that they're guaranteeing the entire lease, not just their kids' portion," concurs Guzman. In the event that there are multiple guarantors, says Guzman, "We typically draft a separate agreement among the guarantors, saying 'I'm responsible for my kids' portion, you're responsible for yours.'" Similar to the roommate agreement, the guarantors would still be liable for the full rent if someone defaults, but have more recourse to come after the other guarantors for the rest of the rent after the fact.
In fact, while many buildings don't allow multiple guarantors, Guzman says some actually require it "because if something were to happen, say, one guarantor's kid leaves, they think they're taking the guarantor with them." Instead, if you leave and intend to take your guarantor with you, your roommates will need to find a new guarantor to replace yours or qualify for the lease on their own.
You'll need to sign your name to more than just the lease
Unless you're moving into the (very) rare breed of building that handles all of the utilities, know that you'll need to sign onto separate accounts for gas, internet, and electric. It seems straightforward enough, but as anyone who has ever dealt with the headache of switching names on a Con Ed account—or found themselves unexpectedly stuck with a bill for someone else's missed payments—can tell you, this can get more complicated than you'd think.
For this reason, Guzman advises splitting up the responsibilities. "What I've generally advised renters in the past is that each person be responsible for a different utility, so that everyone has something in their name besides the lease," says Guzman. "Sometimes you have on Type-A roommate who wants to do everything, but it's better if one person does Con Ed, one person does Time Warner, and so on."
This makes it harder for anyone to skip out without giving notice, and also protects you from the unpleasant discovery that, say, the roommate who's in charge of paying all the bills has been quietly keeping all the money for themselves, leaving the rest of the apartment in the lurch. (Sound dramatic? This exact scenario once happened to a Brick editor.) Instead of having one roommate as the acting head of household, it's best to encourage everyone to step up and have a sense of ownership.
Expect to co-mingle your money
Whoever you're living with, you'll have to get comfortable writing checks and having an up-close-and-personal financial relationship.
While an increasing number of landlords allow individual payments online or through apps like Venmo, some will still require the rent in a single check, and this is also true of the security deposit. "At lease signing, most landlords want two checks," says Guzman. "They might be flexible in how the first month of rent gets paid, but the security deposit needs to be in one full payment." This is because security deposits are put in a separate escrow account to keep your money in a safe, specific place until it's time to move out. This can be handled simply by writing checks to one roommate, who in turn, will then cut a single check to the landlord. But if you'll be required to do this for every rent check moving forward, you'll need to decide who will be the point person, and how you'll get the money to each other (for instance, via expense-sharing apps).
Bottom line: It's best to find out at the outset how your landlord would like the rent and security deposit to be paid, and if necessary, settle on a point person to collect the monthly checks and pay the landlord. And having a pre-determined protocol in place for paying each other (as well as the landlord) is a great way to minimize the potential for misunderstandings or missed payments.
Replacing a roommate who has left will require new paperwork
While many of us have lived in a "musical chairs"-style apartment where roommates cycle in and out, if one roommate is leaving and being swapped for another, don't skip any of the necessary paperwork.
"Some people think, 'One roommate's going, another's moving in, I don't have to tell the landlord as long as we're paying rent'," says Schoenau. "Some get away with it, but it's against the law. Anyone living there has to be granted express permission by the landlord."
Typically, this requires an alteration of the lease with the new names, and the landlord's approval of the new resident. "The tricky part is when one person needs to be released from the lease and another added, we have to re-do the guarantor agreement to some extent," Schoenau adds. "We won't necessarily charge a new fee, provided the rent's the same." But regardless of whether you've qualified on your own or used some sort of guarantor, the landlord will once again want proof that you and your roommates are in good financial stead to afford the rent.
And if you're the one leaving, you've got extra incentive to get your name off the lease, otherwise you'll be responsible for rent in an apartment you no longer live in, or have any control of. "Some young renters are really naive, and think, 'I paid rent for the first six months, I'm leaving, but I'm no longer liable because a new person is in there now'," says Schoenau. "If, for some reason, the new person defaults, you're responsible."
As with everything on this list, if you understand your legal responsibilities ahead of time, discuss finances openly with your roommates, and don't attempt to cut any corners on paperwork, you'll be saving yourself from the potential for serious financial issues down the road—and establishing a healthy pattern of communication with your new roommies. Even if it means a few slightly uncomfortable conversations up front, that's a big win-win.
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