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Know Your Rights: Housing Edition

Couple receives keys to new home and discusses home buyer rights with real estate agent.

Whether you own or rent, housing usually involves a contract — either a lease with the landlord or a mortgage agreement with a bank or credit union. Never sign anything until you’ve had time to thoroughly review the terms of the agreement. It should be a red flag if the other party pressures you to make a quick decision before you’ve had time to think.

Renter Rights and Responsibilities

Your rights as a renter vary depending on the terms of the lease, but under the law, all renters have the right to a “habitable environment.” This means that the space is safe to occupy.

For example:

  • Doors and windows must be secure and functional, with working locks. Windows should not be sealed.
  • The structure must be sound, including floors, stairs and roof.
  • The space must be free of toxic substances and pests (e.g., black mold, asbestos).
  • Hot water heater, toilets and other plumbing must work.
  • Heat, air conditioning and appliances included with the rental must be operational.

Don’t sign a lease unless the landlord agrees in writing to fix anything that makes the space uninhabitable before you move in.

Your responsibilities as a renter include maintaining the space and informing the landlord of anything that might damage the value of the property. You are bound by the lease so make sure you understand the terms before you sign.

Among other things, the lease should outline:

  • How much you pay in rent plus additional fees or charges.
  • The due date for your rent and the penalties for paying late or missing a payment.
  • The conditions of living on the property, such as caretaking of the yard, trash, snow removal, whether or not you can have pets, and any rules about guests.
  • What happens if you want to sublet or break the lease.

If something is missing from the lease, insist that it be written into the contract and make the landlord sign it.

Landlord Rights and Responsibilities

A lease agreement that details renter and landlord responsibilities.Under the Fair Housing Act, landlords may not discriminate on the basis of race, color, nationality, family status, disability, sex or religion. If you feel you have been discriminated against, you can file a complaint with the U.S. Department of Housing and Urban Development (HUD).

The landlord is responsible for maintaining and repairing anything that goes wrong in your rental that wasn’t your fault. If you cause the damage, then it’s your responsibility to fix it, but if there is damage due to weather, a natural disaster or wear-and-tear, that’s the landlord’s job.

In return, the landlord has the right to collect rent, fees and penalties, the right to raise the rent, and the right to evict you if you violate the terms of the lease.

Homeowner Rights and Responsibilities

As with any contract, a homebuyer’s purchase agreement is legally binding. So, even if you don’t understand what you’re signing, once you agree to it, you are responsible for your end of the bargain. For example, many people signed up for adjustable-rate mortgages without planning for how they would afford the higher payments later on, which led to foreclosures. Get help understanding a mortgage agreement before you sign and don’t give in to pressure. If the seller insists that you must act now, be wary. Ask a knowledgeable friend or family member for assistance or find a housing counselor in your local area to guide you in the homebuying process.

In addition to meeting the terms of the mortgage agreement, including paying taxes and carrying adequate insurance, property owners are also responsible for:

  • Obeying local laws about zoning, construction permits and property maintenance.
  • Following the rules of the homeowners association (if any).
  • Assuming liability for the safety of others on the property (for example, if someone trips on a broken step).

Homeowners often carry additional liability insurance to cover unexpected damages such as a crack in the sidewalk or a fallen tree branch that might injure someone. No one can anticipate everything that might go wrong with their home, but insurance provides extra protection against potential lawsuits.

Real Estate Scams

Watch out for these common real estate scams and visit USA.gov for more details on housing red flags:

  • Foreclosure scams. Scammers might offer fake legal help, encourage you to lie on mortgage documents, charge you a fee to help you file for bankruptcy or offer to perform a “forensic mortgage loan audit.”
  • Predatory lenders. Scammers might use false appraisals to sell homes for more than they’re worth, encourage you to lie to get a loan or knowingly lend you more than you can afford to repay.

If you believe you’ve been the victim of a housing scam, use the Federal Trade Commission’s (FTC) Complaint Assistant website.

Ready to learn more about your housing rights and responsibilities? Take SAM’s free My Housing Plan course.

[Any reference to a specific company, commercial product, process or service does not constitute or imply an endorsement or recommendation by the National Endowment for Financial Education.]

See this article in Spanish: Estos son tus derechos relacionados con la vivienda

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