How do monthly installments work?
Here we explain 12 installments plus a security deposit
So, what’s with the “installment” versus “monthly rent payments”?
If you’re signing a lease in Isla Vista, your lease is for about 350 days.
Here’s how it works: you are actually leasing the apartment for a period of approximately 350 days (that period is fully specified in your lease). You agree to pay a specific amount (again, see your lease) over 12 installments for that entire period of time.
12 Equal Monthly Installments, for convenience.
We allow you to make 12 equal monthly installments on that full amount of rent due. These are not rent payments for the month, instead they are installment payments. If you actually had a lease for the entire year (which is not usually the case in Isla Vista, since we need time for cleaning and repairs in between tenancies), then the cost, and the related monthly installments, would be higher.
(Really 13 installments)
(Okay, your rent payment lease total is divided into 12 installments, but there is also the security deposit, which is due before you move in at lease signing.)
Show Me an Example of Monthly Installments in Action
Let’s look at an example. Let’s say you lease a 1 Bedroom Unit in Isla Vista. You agree to lease the apartment for a total of $24,000 for the duration of the lease (approximately 50 weeks). A monthly installment on this amount is $2000 ($24,000/12). You would also, of course, owe a security deposit equal to what is specified in the lease. If the lease had actually been for all 52 weeks, then the total lease amount would be approximately $24,960. Again, we do not offer such full year leases in Isla Vista.
Two Common Misconceptions about Monthly Payments
There are really two primary times when people get confused about installment payments versus monthly rent payments.
First, folks like you will check their lease and find that their lease period isn’t 365 days. So, they ask: do I get a prorata refund for the roughly 2 week difference? The answer is NO. Why? Because the discount is already factored into the total cost of the full period of the lease. If it were for a full year, it would cost more and, again, we don’t do the full year in Isla Vista in order to allow time to clean and fix any issues with your place in between tenancies.
Second, and sort of related to the first one, people forget to refer to “monthly rent payments” as “rent installments” (including us)! As should be clear by now, this isn’t technically quite correct. What is meant is the “rent installment”, but it’s a lot easier to say “month’s rent.”
We do very rarely run into situations where residents and guarantors are concerned about the “installment payments” and we thought an explanation with examples would clear this up.