Seven steps to take when renting a home

1. Spend less than 30% of your gross income on rent.

Gross income means your income before taxes and other things are taking out. If you go higher than 30%, you'll probably be pinching somewhere else in your budget — or not saving anything for retirement or a future home purchase. If you want to compare rental properties and prices in your area, here are a few resources:

• Pad Mapper: www.padmapper.com
• Hot Pads: www.hotpads.com
• Apartment.com: www.apartment.com

2. Carefully review your lease.

Get a written copy of the lease and actually spend the time to read it all the way through. Who pays for utilities, garbage, water? What's the security deposit? Are there any annoying rules for the building that will get in the way of owning pets or pursuing hobbies, like playing music? 

You don't need a lawyer to review a lease, but be sure to clear up anything you don't understand. And if you don't agree with anything, don't sign the lease based on a verbal promise from the landlord. Get things in writing. If something is written in your lease, chances are it will be binding.

3. Pick roommates who are financially responsible.

If you're signing a lease with other people as co-tenants, make sure they're creditworthy and won't stick you with the full tab. Most leases have the language "joint and several" in them, which means that any signer of the lease is potentially responsible for the entire rent if somebody doesn't pay their share.

Research has shown that oftentimes roommates adopt the spending and saving habits of the people they live with. Pick roommates who have a budget, who strive to spend less than they earn and who make simple living and saving for the future a priority. Before you move in together, discuss how you are going to manage money and share expenses. Having conversations early on can help you avoid awkward or uncomfortable situations.

• See also: Budgeting

4. Pay by check and get a receipt. 

Pay any initial rent or security deposit by check and get a receipt. This sounds obvious but with all the free, online networks where you can find and post rental houses, you have to be extra careful of scams. There have been scams where people posed as building owners and only took that initial payment in cash, never to be seen again.

5. Document the condition of your place.

Take photos of the place (preferably with dates on them) when you move in and upload them somewhere so you can refer to them when you eventually move out. You're responsible for damage beyond reasonable wear and tear, but some landlords are notorious for overstating how pristine your apartment was in when you first moved in. If you take good photos, you'll avoid being over-charged.

6. Ask for repairs in writing.

If you notice anything that's off, like a broken appliance or heat that doesn't work, ask for it to be fixed immediately and do so in writing. Your first days there are the best times to set the expectations with your landlord, and he or she has an obligation to provide everything promised in your lease. Keep in mind though that extras not promised in the lease might be your responsibility.

7. Get renter's insurance.

This covers your stuff against theft or fire, and can be really cheap. Before you buy a policy, you want to figure out how much you need. 

• See also: Renter's insurance

Things to do when you move

When you've rented your home and it's time to move, here are a few steps you can take:

• Get a mover. 
  If your time is more valuable than the cost, invest in a good moving company. If you can't afford it, then do the move yourself. Ask around for moving recommendations and, before you pick a mover, get references. When you have a few choices narrowed down, check with your local Better Business Bureau to make sure they aren't negatively rated.

• Deduct moving expenses on your tax return.
  See if you can deduct moving expenses on your tax return. Typically this is only if you move a long way for a job, and itemize your deductions. Be sure to keep your all your receipts associated with the move. The full rules are described in IRS Publication 521.

• IRS Publication 521: www.irs.gov/publications/p521/index.html

• Tie up all loose ends.
  You're leaving your past home, so be sure to square everything away there. Transfer the utilities out of your name, or have them shut off. Cancel the phone and cable, or have it transferred to your new place if that's an option. 
  
  If you were renting, ask for a move-out inspection at least a few days before the last day of your tenancy, so you can confirm that your landlord is happy with the condition of the place and will return your security deposit (fix any deficiencies). Get your contact information to your landlord so he knows where to send your check. For all of this stuff, do as much as possible in writing so you have a paper trail.

• Change your address.
  Tell everyone about your new address. Start with the post office of course, by filling out a forwarding order, but don't forget ones that can result in money problems if you can't be found later. Examples include banks and other financial institutions where you have accounts, your current and possibly prior employers, your insurance company (auto rates might change) and the IRS.

• If you changed states, update your identification and tax documents.
  If you changed states, here are some things you need to do in addition to the typical move:

• Get a new driver's license.
  Some states slap you with a fine if you get caught with an out-of-state license and have lived in the new state for a while.

• Figure out how to split income taxes by state.
  If you moved states, you need to figure out how you'll have to split your income tax returns for the year. Typically the income is divided based on when it's earned, and where you lived at the time, but this can be complicated to figure out. Each state with an income tax typically has forms and instructions specifically for part-year residents. This can be difficult to do alone, so talk to a tax professional for guidance.

• Re-title your property if you have to.
  See if any assets you own need to be re-titled based on your new state's laws. An example is if you moved between a community property state like California, and one that doesn't recognize community property.

Links we like

Here are a few online resources you might find useful:

• Pad Mapper: www.padmapper.com
• Hot Pads: www.hotpads.com
• Apartment.com: www.apartment.com
• IRS Publication 521: www.irs.gov/publications/p521/index.html