Single mom tips on affording security deposits and avoiding scams (2024)

Renting a new home usually requires a deposit of first and last month’s rent, plus a one-month security deposit. In some areas, it is impossible to find a rental without paying a broker’s fee of one month —bringing move-in costs to $10,000 or more.¹

These upfront costs, plus application fees and moving expenses, can present a significant financial challenge — especially for low-income, first-time renters. However, we found dozens of government and community programs for those who qualify — and scams to avoid.

Sometimes you have to do what you have to do.

Single mom Darlene Mersereau told me: “I live in Massachusetts and our rental market is insane. Average rent for a two bedroom is $2,400 outside of the cities, and landlords typically require first, last and security. Additionally, it’s hard to find a rental without using a realtor — which is typically a full month’s rent. So for a 2 bedroom, it’s almost $10,000!

“The only way I’ve navigated this is by using my company bonus and pulling from savings or a 401K loan. When I get my security deposit returned, I try to pay down the 401K loan.”

If you don’t have any savings (or prefer not to blow it all on a deposit), keep reading:

First: Know security deposit laws in your state

Avoid housing scams

Rental and security deposit assistance

• Government programs
• United Way 211
• Local churches and charities
• NACA housing programs
• Salvation Army
• St. Vincent de Paul
• Catholic Charities
• ERA2
• No-deposit rentals

First: Know security deposit laws in your state

Housing scams, especially in this age of housing shortages, are common. Do the deposit rules for your dream home sound fishy? Do your homework.

For example, most states limit the security deposit to two months, but in some cities, like San Diego, laws limit a security deposit to one month’s rent, as do the states of Alabama and Nebraska.

This article outlines security deposit laws for each state.

It is also helpful to be familiar with the federal Fair Housing Act,² which allows landlords to charge higher deposits based on rental history (evictions, broken leases), pets and credit scores, but not for children and service animals.

Avoid housing scams

When people are desperate, a huckster is waiting to take advantage. When it comes to emergency housing situations, here are some common scams and predatory offers to keep an eye out for:

• The property manager asks you to wire money or pay in an unusual way like cash or a gift card
• The deposit violates the Fair Housing Act or laws in your state
• High-interest loans cloaked as rental deposit assistance
• Advertisem*nts for no-deposit rentals, but then a bait-and-switch is revealed when a deposit is later required

Rental and security deposit assistance

Check out these charities and programs that help low-income and first-time renters:

Government programs

Some states, cities and counties still operate security deposit programs. They are typically run by local housing departments that oversee a specific area. These programs are often in place for homeless or low-income people and may provide a subsidy to cover up to one month’s rent.

In some areas, like San Diego County, Calif., security deposit assistance of up to two month’s rent is offered for a limited time to landlords as an incentive to start new leases with renters who participate in housing voucher programs.³

How to get help:

To find security deposit programs in your area, start with your local department of housing. The location of your housing department and the programs it oversees will vary by state, city, county or other locality.

If you aren't sure where to start, the United Way’s 211 is a great resource that can help you find housing departments, as well as active security deposit programs. Dial 211 on your smartphone or landline or visit 211.org.

Here are some local housing resources that can help:

• Public housing agencies
• Local HUD offices
• State housing finance agencies
• Usa.gov housing resources
• National Low Income Housing Coalition (NLIHC)

You can also check the HUD rental help pages for each state:

United Way 211

The United Way helps people find community resources through its 211 service, which connects you to an expert who will help you find any available rental or security deposit assistance programs in your area.

When using the 211 website:

1. Click on “Find a local 211”.
2. Enter your address or zip code and click “Search”.
3. Click “Search for resources online”.

This will take you to your local 211 search page, where you can type “rental deposit assistance” or “rent payment assistance” in the search term field. This will bring up a list of agencies in your area that may provide help.

How to get help:

• Dial 211 from your phone or visit 211.org

Local churches and charities

Connect with local churches in your area to ask about help as a first-time, low-income renter. While not all churches have specific programs set up to help renters, some use donated funds to help people that need temporary support toward self-sufficiency.

For example, the Bel Air United Methodist Church in Maryland offers security deposit assistance to Harford County residents as part of its Pass It On Ministry.⁴

Sacred Heart Community Service offers emergency deposit assistance and first month’s rent for low-income Santa Clara County residents in California.⁵

How to get help:

Do a Google search to find local charities and nonprofits that help families in need or use sites like FindHelp.org.

If you are a member of a church, it’s a good idea to ask if your church offers help, but in many cases, membership is not necessary for one-time assistance. However, you may need to provide proof of need or enroll in church-led financial literacy courses.

How to get help:

• Reach out to local churches
• Search “churches near me” online

Churches and charities also often provide help for other housing-related expenses, like free furniture, free appliances, free internet, and free money for utility bills.

NACA housing programs

The Neighborhood Assistance Corporation of America (NACA) is primarily known for its home ownership programs but also offers a rental housing program. The program offers housing counseling to low and moderate-income renters, which includes referrals to emergency housing, homeless prevention and social services.

How to get help:

• Call 425-602-6222
• Email [emailprotected]

Salvation Army

The Salvation Army is a religious organization that has long provided housing assistance. Some branches have a rapid rehousing program that helps with the first month’s rent in emergency situations. Program availability is dependent on local resources and funding.

How to get help:

• Contact your local Salvation Army branch
• Read about Salvation Army rent assistance

St. Vincent de Paul

St. Vincent de Paul is a faith-based organization that serves individuals and families with diverse needs. Local branches may offer one-time rent assistance.

How to get help:

• Contact your local St. Vincent de Paul

Catholic Charities

Catholic Charities provides affordable housing across the country and offers emergency and temporary housing aid. Some locations may offer assistance with your first month’s rent or a security deposit.

For example, if you have an eviction notice and need a new place to rent, the New York-based Fulton Montgomery Catholic Charities will pay the first month’s rent⁶ for applicants who have been denied help from the Department of Social Services.

Services vary by area, so contact your local Catholic Charities agency for specific details.

How to get help:

• Call 703-549-1390
• Find your local Catholic Charities agency
• Email [emailprotected]

ERAP2

Did you know the U.S Department of the Treasury has an emergency rental assistance program? Known as ERAP1 and ERAP2, the ERAP1 program ended in December 2022, but ERAP2 is still active in some areas.

The Low Income Relief YouTube channel shared some insights on this program that helps eligible households that have trouble paying rent, utilities and other housing costs:

Keep in mind, these funds are available for emergency situations to cover past-due rent and utilities and are not an option if you don’t meet eligibility guidelines. Additionally, some states have exhausted their ERA2 funds.

To be eligible for ERA2:

• You or a member of your household is qualified for unemployment benefits, or has experienced reduced income, or has significant costs, or is navigating a financial hardship that is due directly or indirectly to the COVID-19 pandemic
• At least one person in your household is able to prove that they are at risk of homelessness or in an unstable housing situation
• Your household is considered low-income if your income is below 80% of the HUD area median income guidelines⁷

How to get help:

• Visit the ERA program information page

No-deposit rentals

Some apartment communities and landlords may offer “no deposit” or “zero deposit” rentals. This could be from a rental promotion or it may be an option for well-qualified renters — those with excellent credit and a good tenant reputation verified by a former landlord.

You may also be able to avoid a deposit if you take over a current lease.

“If a renter has to leave their unit before their lease is up for whatever reason, they may need to find someone to take their place until the end of the lease,” Seamus Nally says. Nally is CEO of TurboTenant landlord software.

Nally says such opportunities are often posted on sites like Facebook Marketplace, Craigslist, and classified ads in your local paper.

“If you can secure this kind of deal, that usually allows you to avoid having to pay a security deposit,” he says. “Just make sure that the landlord consents to you taking over the lease.”

In some cases, you may have to pay a security deposit once the lease is up, but you can verify that with the landlord and then save up to prepare for the upcoming expense.

That is the key when it comes to any type of rental agreement. Verify it with the landlord. Go to the actual property you wish to rent to meet the landlord or property manager in person. If you are moving from a different state and cannot visit the property, find a reputable real estate agent in the area who also handles rentals. This way, you can avoid scam artists.

There are also resources to get help with moving expenses.

How to get help:

• Google no deposit rentals near me and verify the information with the rental office or landlord
• Look through classifieds or ask around to find options to take over an existing lease
• Use a realtor to find zero deposit rentals

These are some more resources for low-income single moms and their families:

SOURCES

1. “Average Rent in the U.S.” March 2024. RentCafe. https://www.rentcafe.com/average-rent-market-trends/us/
2. “Housing Discrimination Under the Fair Housing Act,” U.S. Department of Housing and Urban Development. https://www.hud.gov/program_offices/fair_housing_equal_opp/fair_housing_act_overview
3. “AB-12 Tenancy: security deposits” October 11, 2023. California Legislative Information. https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=202320240AB12
4. “Pass It On Ministry Financial Assistance Ministry” Accessed April 25, 2024. Bel Air United Methodist Church. https://belairumc.org/financial-assistance-pass-it-on-ministry/
5. “Deposit Assistance” Accessed April 25, 2024. Sacred Heart Community Service. https://www.sacredheartcs.org/deposit-assistance
6. “Catholic Charities Emergency Assistance” Accessed April 25, 2024. Fulton Montgomery Catholic Charities. https://www.catholiccharitiesfmc.org/emergency-assistance
7. Area Median Income Lookup Tool. Fannie Mae. https://ami-lookup-tool.fanniemae.com/