I am always surprised at how many times when someone calls me about an apartment I have for rent, that they have no idea how much their monthly income is. It is vitally important for a landlord as the decision maker to be able to know that information as quickly as possible.
Being prepared with the answer for “how much money do you make a month”, shows the landlord that you have done your homework, you know how much you probably can afford. You can also help the landlord analyze easily whether or not you will qualify for the apartment. Let me walk you through a brief example on how to figure out this information that the landlord needs.
Do The Math
First, know how much you earn per hour. Then take that number, and multiply it times the number of hours you usually work per week. This will give you your weekly amount of income.
Then, take that number for your weekly income, and multiply that times 52. If you get paid biweekly, then take your bi-weekly income and multiply that times 26. Either one of these two methods in will give you your annual gross income for the year. Now take whatever the annual gross income is, and divide that number by 12.
This will now give you an idea of your gross monthly income.
This is the number that the landlord is looking for. So when you call, and you have your gross monthly income information at the tip of your fingers, you have shown the landlord that you respect his time, you probably know what you can afford, and you have been respectful enough to do your homework before calling.
This will also show the landlord what type of resident you may be should they decide to rent to you. Having this information before you call the landlord can only help you and put you in a better position to get that apartment.
Here is an example on how to determine your monthly gross income:
You earn = $15.00/hour
You work = 40 hours/week
Your weekly pay = $15 x 40 = $600/week
Multiply your weekly income times 52 (52 weeks in a year)
$600 x 52 = $31,200
$31,200 is your annual gross income.
Divide your annual gross income by 12 (12 months in a year)
$31,200 / 12 = $2,600
$2,600 is your monthly gross income.
Sometimes, when I speak to people on the telephone. They are not sure which is the gross pay, and which is the net pay from their paycheck. I have a simple illustration to help explain this. Picture that you are fishing on lake. You take your fishing net and scoop it into the water to catch the fish. When the fish, and the water, and everything else is in the lake is under water; that is “gross”.
When you pick up the fishnet out of the water and all you have left is the fish; that is the “net”. So, “gross” is the entire amount of your paycheck before the taxes and other deductions come out of it. Your “net” pay is what is left that goes into your bank account after the deductions and taxes have been paid.
Some landlords may do their calculations on your gross pay. Some landlords may wish to do the calculations off of your net pay. At least, by using this example to figure out your numbers first, you will know either your gross pay, or your net pay, depending on what the landlord asks for.
Determining Your Utility Budget
Here is another good tip for figuring out your utility expense when creating a budget for your new dream apartment. Find out from the landlord what type of heating utilities are being used in the apartment.
An example may be, the apartment is heated with oil, or maybe the apartment is heated by natural gas. You want to find out from the landlord which utility provides the heating for the apartment. Then, you can call the utility company and request the last 2 or 3 years of meter usage for that specific apartment at that address. This will help you to figure out an average of how much to budget for utilities for that specific apartment.
This is a very good tip for anyone looking for an apartment. You can repeat the same process if you will be paying the electric bill as well. Just ask the landlord who pays the electric utility (renter or landlord) then call that utility company and ask again about the meter usage for that specific apartment for the last 2 or 3 years.
Another great tip when planning your utility budget is to see if the specific utility offers some type of payment schedule plan for winter heating months. By doing this you will be able to know how much you will actually be spending every month during the heating season.
This way, you can get on a payment schedule plan and then when spring rolls around start working on paying down the remaining balance. This is a great idea for natural gas customers. You can also look into some oil companies that may work with you to do payment schedules as well.
Do you have any ideas on this topic you could share to help our online community? Please chime in to share a comment or review.
Warmest regards,
Brian Lucier
Belaire Property Management
Regional Property Manager
(978) 448-0669
info@belaire.co
www.belaire.co
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