When you have student loans, committing to any recurring expense is difficult. And the biggest expense most people have each month is housing.
Picking a home is a major lifestyle decision and a major budget decision. Before you sign the lease, make sure it will make you happy and fit your budget. Follow these steps for ideas on how to pick an apartment and how to save money on rent.
How to pick an apartment with student loan debt
1. Decide if you need/want a roommate
Some people absolutely want to live alone, while others can’t imagine living without a roommate. This is a personal decision to make, but also a financial one for an important reason: living with a roommate saves money.
While the absolute cost of an apartment goes up as it gets bigger, the cost per person is typically lower when you share it with one, two, or three roommates.
While I was in graduate school working on my MBA, I lived with a roommate in an older house off campus to save on rent. When I finished school, I moved into my own apartment, but took care to find a really inexpensive one.
Saving thousands of dollars on rent while living with a roommate helped me pay off my student loans much faster than if my rent had been nearly twice as much living on my own.
2. Determine your must-haves
Are you a gym rat who could save big by having a gym in your apartment? Gym memberships can be big budget busters and the savings (and convenience) of an in-building gym might be high on your list.
Or maybe you really want your own bathroom because of roommates. If you don’t have any, you might be able to save by renting a studio versus a one-bedroom, depending on your preferences.
Every apartment feature on your list may drive up the cost. Remember to prioritize needs versus wants and be ready to sacrifice some wants to keep costs down while affording the features you want most.
3. Scout locations
What is the most important factor in the cost of real estate? Location, location, location.
A sweet downtown pad might be your dream, but the exact same apartment a few miles away could be half the cost. If you do put location as the top requirement on your list, that could mean sacrificing on size, amenities, or even a parking space. However, a downtown apartment could mean you can live car-free and save big on another part of your budget.
Visit some of the neighborhoods to decide where you want to live in general, then build out your list of apartments by neighborhood so you can most efficiently visit and pick your favorite.
4. Visit apartments you can afford
Don’t tempt yourself into paying more for an apartment than necessary. Look at your income and other monthly expenses, including student loan payments, to really understand what you can afford to spend on an apartment each month. Cross any apartments off your list that are above that range.
Next, call ahead to set up visit times and apartment viewings by neighborhood to make the best use of time. Bring a notepad to take notes of what you like best, what you don’t like, and anything you want to remember for later on.
Each time you visit a new apartment, keep whittling down your list to the top two or three. When you’ve picked your favorite, call the landlord and get the paperwork started.
5. Move in!
Congratulations: you’ve picked an apartment you love and can afford. Get moved in, settled, and enjoy.
The key takeaway here is to nail down your budget, determine exactly what you can afford, then choose the appropriate apartment based on that number. You might have to make some compromises on your wishlist, but the more you can save and pre-pay your student loans, the sooner you will have that debt behind you.
Once those student loans are paid off, you will have hundreds of dollars more each month to save, invest, and use for the eventual home of your dreams.
Interested in refinancing student loans?Here are the top 6 lenders of 2018!
|Lender||Variable APR||Eligible Degrees|
|Check out the testimonials and our in-depth reviews!
1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 6.97% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.23% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at email@example.com, or call 888-601-2801 for more information on ourstudent loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
Savings example: average savings calculated based on single loans refinanced from 9/2013 to 12/2017 where borrowers’ previous rates were disclosed. Assumes same loan terms for previous and refinanced loans, and payments made to maturity with no prepayments. Actual savings for individual loans vary based on loan balance, interest rates, and other factors.
Application detail: 5 minutes indicates typical time it takes to complete application with applicant information readily available. It does not include time taken to provide underwriting decision or funding of the loan.
Instant rates mean a delivery of personalized rates for those individuals who provide sufficient information to return a rate. For instant rates a soft credit pull will be conducted, which will not affect your credit score. To proceed with an application, a hard credit pull will be required, which may affect your credit score.
Total savings calculated by aggregating individual average savings across total borrower population from 9/2013 to 12/2017. Individual average savings calculation based on single loans refinanced from 9/2013 to 12/2017 where borrowers’ previous rates were provided. Assumes same loan terms for previous and refinanced loans, and payments made to maturity with no prepayments. Actual savings for individual loans vary based on loan balance, interest rates, and other factors.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate||Visit SoFi|
|2.47% – 6.23%1||Undergrad & Graduate||Visit Earnest|
|2.47% – 8.03%4||Undergrad & Graduate||Visit Lendkey|
|2.95% – 6.37%2||Undergrad & Graduate||Visit Laurel Road|
|2.48% – 6.25%5||Undergrad & Graduate||Visit CommonBond|
|2.72% – 8.32%6||Undergrad & Graduate||Visit Citizens|