Renting your first apartment in America: lease, deposit, and credit check.
Renting an apartment in the United States comes with a few terms that can feel unfamiliar if you have not heard them before: lease, security deposit, credit check, adverse action notice. The landlord may ask for money before you have even seen your keys, and a number you may not know much about, your credit score, can decide whether you get approved.
This guide walks through the process in order: the application and credit check, the lease, the security deposit, and the move-in and move-out steps. Rules about leases and deposits are set mostly by state law, so I use New Jersey as a worked example, based on the state's official tenant guide, and I point out where federal rules apply to everyone. The details were checked against official sources such as the New Jersey Department of Community Affairs (DCA), the Federal Trade Commission (FTC), and the Consumer Financial Protection Bureau (CFPB) in early October 2026.
The Rental Roadmap
The rental process in six steps, from application to move-out.
Most rentals follow the same six steps. You apply, the landlord screens you, you read and sign the lease, you pay money up front, you move in, and later you give notice and move out. The sections below take them in order.
Step 1: The Application and the Credit Check
When you apply, expect the landlord or property manager to run a screening. The FTC explains that tenant background checks can include a variety of information, such as rental and eviction history, credit history, or criminal records. Those reports are treated as consumer reports under the Fair Credit Reporting Act.
New Jersey's DCA guide says landlords may access credit reports for prospective tenants from credit bureaus or tenant screening agencies, may use that information to approve or deny an application, may charge you for the cost of the report, and may request reasonable application fees or employment verification. The same guide notes that a landlord may refuse to rent to someone for insufficient income or poor credit history, while discrimination based on protected characteristics is illegal under state and federal law.
Before you pay a fee, ask what is being checked. The FTC advises asking what information the landlord uses to decide whether to rent to you before you pay an application or background check fee.
Your Rights If the Report Counts Against You
If a landlord uses information from a screening report against you, federal law requires them to tell you. This is called an adverse action notice. According to the CFPB, it applies to denying a rental application, increasing the rent or security deposit, or requiring a co-signer. The FTC adds that the notice is required even if the report was only one of the reasons.
What you can do if a landlord acts on a screening report: notice, free copy, check, dispute.
Here is what you can do after a notice. The FTC and CFPB explain that the company that made the report must give you a free copy if you ask within 60 days. You can review it for errors and dispute them, and the screening company generally has 30 days to investigate. You can also file a complaint with the CFPB if the problem is not resolved.
Check Your Own Credit Report First
Because landlords often rely on credit information, it helps to look at your own reports before you apply. The FTC says you can check your credit report at Equifax, Experian, and TransUnion once a week for free through AnnualCreditReport.com. If you want to understand how scores are built, I explain it in my beginner's guide to credit scores.
If You Are New to the U.S. and Have No Credit History
Many newcomers have a limited U.S. credit history, because credit history from another country generally does not transfer, according to Wells Fargo and Experian. Landlords handle this differently, so the practical step is to ask the landlord or property manager what they accept in place of a U.S. credit history, and what each option would cost, before you pay an application fee.
Step 2: The Lease
A lease is the agreement between you and the landlord. New Jersey's DCA guide explains that a lease can be oral or written, and that a written lease must be in plain language that the average person can understand. The guide advises tenants to read the rental agreement before signing and to get a copy of the lease for their records at the time it is signed.
What to Look For
Parts of the lease to read before you sign.
The DCA guide lists provisions that it recommends a lease include: conditions of occupancy, a description of the rental space, renewal provisions, late rent penalties, responsibilities for rent, pets, and utilities, restrictions on subletting, requirements about keys, and any requirement that the tenant obtain renter's insurance. It also says that any fees the landlord intends to charge, such as late fees and attorney fees, should be clearly stated.
A few of these deserve a closer look:
- Renewal. The DCA guide says many leases contain a clause about renewing. Most yearly leases require 60 to 90 days' notice from the tenant to end the lease, and if notice is not given in time, the lease can renew automatically. In New Jersey, a yearly lease that is not renewed automatically becomes a month-to-month lease when its term ends.
- Breaking the lease. If you move out before the end of the lease, the guide says the landlord may hold you responsible for rent until the apartment is rented again or the lease ends, whichever comes first. The landlord must make an effort to re-rent the unit.
- Rent increases. In New Jersey a landlord cannot raise the rent in the middle of a lease term. The old lease must be ended and a new one offered at the higher rent, with proper written notice. The state has no statewide rent control, although towns may pass their own.
- Utilities. Ask which utilities you pay for and who sets up the accounts. If you will pay for electricity or gas, my guide on reading a U.S. utility bill shows where to look when a bill goes up.
- Required disclosures. Landlords must give certain information. For example, under a federal rule, landlords of many homes built before 1978 must give tenants an EPA pamphlet on lead hazards before the lease is signed. New Jersey also requires flood zone notices and, in larger buildings, a copy of the state's Truth in Renting statement.
If you are in a different state, look for your state's equivalent guide. Search for your state's attorney general, housing agency, or tenant rights page.
Step 3: The Security Deposit and Other Up-Front Costs
A security deposit is money you give the landlord to cover damage or unpaid rent. The money still belongs to you, and the DCA guide says it must be held in trust. Cap, interest, and return deadlines are set by state law, so the details below describe New Jersey and will not match every state.
Security deposit rules in New Jersey, as described by the state's Department of Community Affairs.
How much can a landlord collect? In New Jersey, no more than one and a half times one month's rent. The DCA guide also says that prepaid funds held to secure future rent, including the last month's rent, count as part of the deposit. The landlord can require the security deposit plus the first month's rent, so at most two and a half times the monthly rent at the start of the lease. The landlord is not required to collect a deposit at all.
Where is it kept, and who gets the interest? The landlord must hold it in an interest-bearing account and tell you in writing within 30 days where it is. The interest belongs to the tenant and is paid in cash or credited toward rent.
How do you get it back? Within 30 days after the tenancy ends, the landlord must return the deposit plus interest, less lawful deductions. Deductions can cover damage beyond normal wear and tear and other money owed under the lease. If there are deductions, the landlord must send an itemized list. If the landlord does not return the deposit on time, or you disagree with the deductions, the DCA guide says you may sue for double the amount wrongfully withheld, along with court costs and reasonable attorney's fees. The guide also notes that there is no state agency that handles deposit disputes, so they are settled through the courts.
Other costs to plan for. Besides the deposit and first month's rent, plan for application or screening fees, the cost of moving, utility setup, and renter's insurance if the lease requires it. Some of these are separate from what the landlord asks for, so add them up before you commit.
Step 4: Moving In
On move-in day, look at the unit with the lease in hand. The DCA guide says that when a lease ends, you are responsible for returning the property in the same condition you received it, apart from normal wear and tear. So it helps to write down the condition of the unit when you arrive, take dated photos of any damage, and report problems to the landlord in writing. Keep your copy of the lease and the receipts for what you paid.
A few rights are worth knowing from the New Jersey guide. A landlord generally cannot enter your home without your consent, except for emergencies and certain inspections and repairs, which require reasonable notice, normally one day. Every residential lease carries an implied warranty of habitability, which means the landlord must keep the home fit to live in, and tenants should report problems in writing. Locking a tenant out or shutting off utilities to force them to leave is illegal in New Jersey.
Step 5: Living There and Renewing
Pay rent on time and keep records. If something breaks, notify the landlord in writing and keep a copy. As the end of your lease approaches, check the renewal clause in your lease, because missing a notice deadline can renew the lease automatically.
Step 6: Moving Out
Read the lease for the notice you must give. Leave the unit in the condition required, give your landlord a forwarding address in writing, and keep photos of the unit when you leave. Then count the days: in New Jersey, the landlord has 30 days after the tenancy ends to return the deposit and any itemized deductions.
A Quick Checklist Before You Sign
- Check your credit reports for errors using AnnualCreditReport.com.
- Ask what the landlord screens for and what fees you will pay before you apply.
- Read the whole lease and get a copy.
- Confirm the deposit amount and how it will be held.
- Add up the move-in costs: deposit, first month's rent, fees, moving, utilities, and insurance.
- Document the condition of the unit on move-in day.
- Know your state's rules. Find the tenant guide from your state's housing agency or attorney general.
My Take
Moving into a new place costs more than the rent and the deposit. Three years ago, when I moved into a new apartment, a mover quoted me $1,500. I rented a truck instead, which came to about $150 including insurance, a short rental period, and gas. Two friends helped, and I spent about $200 on dinner for them afterward. I lived alone and did not have much to move: a couch, a bed, a computer desk, a TV, and about eight boxes. Whatever you decide, count the move itself as part of your up-front budget, in addition to what a landlord asks for.
Frequently Asked Questions
What is a security deposit? It is money you give the landlord at the start of a lease to cover damage beyond normal wear and tear or unpaid rent. It remains your money, and state law sets how much a landlord can collect and when it must be returned.
Will a landlord check my credit? Often, yes. Landlords may use credit reports and tenant screening reports. If they deny you, raise your deposit, or ask for a co-signer because of a report, they must give you an adverse action notice.
What if I have no U.S. credit history? Credit history from another country generally does not transfer. Ask the landlord what they accept instead, and ask about costs before paying a fee.
Can a landlord raise my rent during the lease? In New Jersey, not in the middle of a lease term. The old lease must be ended and a new one offered at the higher rent with proper notice. Rules differ by state and by town.
How long does the landlord have to return my deposit? In New Jersey, 30 days after the tenancy ends, with interest and an itemized list of any deductions. Other states have different deadlines.
Disclaimer: This article is for general information only and is not legal advice. Landlord-tenant laws differ by state and by city and can change, and the New Jersey details above come from the state's Truth in Renting guide. For advice about your own lease or dispute, consult your state's housing agency, a legal aid organization, or an attorney.
Sources
- New Jersey Department of Community Affairs, Truth in Renting: A guide to the rights and responsibilities of residential tenants and landlords in New Jersey, and the Landlord-Tenant Information page
- Federal Trade Commission, Tenant Background Checks and Your Rights and Using Consumer Reports: What Landlords Need to Know
- Consumer Financial Protection Bureau, Federal housing agencies strongly encourage landlords to provide tenants written notice of their rights and What should I do if my rental application is denied because of a tenant screening report?
- Federal Trade Commission, You now have permanent access to free weekly credit reports
- Wells Fargo, How to build credit when you're new to the US, and Experian, How to build credit when new to the U.S.
Suggested Reading
What goes into a credit score, how to check it for free, and how to build credit in the U.S.
What renters insurance covers and why some leases require it.
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