To prorate means to divide something (in this case, the rent) proportionally based on time. If you were to divide your rent by the number of days in the month, you’d get the approximate amount you are paying each day. This is your prorated rent amount – your rent broken down over time.
In most states, landlords are under no obligation to prorate the rent. This means that no matter when you move in or out, you are responsible for paying the entire month’s rent. Landlords may choose to prorate to get an unoccupied unit rented sooner, or simply to be fair. Ask the landlord about their policy if you plan to move in after the first of the month, and be sure to know your state and local laws.
Why prorated rent?
There are many different reasons why your rent might be prorated. For example, if you need to move in on the 15th but the landlord typically requires rent to be paid on the first, the rent might be prorated so you don’t have to pay for the days you aren’t living in the rental. This would also keep your rent due date on the first rather than starting on the day you moved in.
If a landlord chooses to prorate rent, they’ll typically require you to pay a full month for the first month and they will prorate the second month. This is because many places require first and last months’ rent at the lease signing. They also do this to make sure you can pay the full rent amount.
You might also want a prorated amount if you can’t move out right away at the end of your lease term. Let’s assume you are moving from your current rental at the end of the month (when your lease expires), but you can’t move into your new place until the 10th. Instead of staying with a friend or relative for more than a week, you’d rather stay in your current apartment until you can move into your new place. You can talk to your landlord about staying a few extra days and paying a prorated rent amount (the month’s rent minus the days remaining after you move out).
Keep in mind that if you want to move out before your final month is up (you paid through the 30th but want to move out on the 15th), the landlord probably won’t prorate the rent since you signed a lease for the full lease term. In this case, you are responsible for paying the full amount, even if you choose to leave early. If, however, the landlord asks you move out a few days early, you could request prorated rent.
In addition to moving in or out before or after the specified move date, there are some other times rent might be prorated. If your landlord allows you to sublease your apartment, you might need to prorate the rent based on when the sublease begins or ends.
If you must move suddenly and you are unable to give a full 30 days’ notice, your landlord could prorate your rent to get the amount you owe to fulfill the 30 days’ notice requirement.
There are reasons landlords might prorate rent that doesn’t impact you as a renter, but you might be curious about. For example, if a landlord sells the rental property, they may prorate the rent to determine how much the buyer is entitled to. Let’s assume they close the deal on the property later in the month, after rent was collected. The buyer would get the portion of the rent from the closing date to the end of the month.
How to Calculate Prorated Rent
There are several ways a landlord might calculate prorated rent. The amount could be based on the number of months in the year. This method takes the monthly rent and multiplies it by 12. That number is divided by 365, the number of days in a year. Multiply that by the number of days you are paying for.
Let’s assume your rent is $900 a month. You want to move out on the 20th and there are 30 days in the month. The landlord agrees to prorate the rent so you don’t have to pay the remaining 10 days (the days after you’ve moved out). Here’s the calculation:
$900 x 12 months = $10,800
$10,800 / 365 days = $29.60
$29.60 x 20 days in rental = $592
Using this method, you would pay $592 in rent for the partial month.
Another method is based on the number of days in the month, and it is a little simpler. It takes the monthly rent and divides by the number of days in the month. Take that amount and multiply it by the number of days you’ll be in the rental. With this method, based on the same numbers above:
$900 / 30 days in the month = $30
$30 x 20 days in rental = $600
While the amount of the month calculation is slightly higher, it would be less if there were 31 days in the month. A landlord can choose either method as long as it is applied consistently. A landlord can’t use the yearly calculation for one tenant and the monthly calculation for another. This would violate Federal Fair Housing laws, which requires consistent methods and standards for all renters.
What is a banker's month?
The term “banker’s month” simply means a standardized 30 days for all months. So, even if the month has 31 days (or 28 days if it’s February), your landlord will still use 30 days for the calculation. This may result in you having to pay a little more depending on the number of actual days in the month, but it is simpler to calculate the prorated rent amount this way.
How to Ask For Prorated Rent
If you are looking for a place to rent and you want to move in after the first of the month, talk to the landlord and politely ask if they would consider prorating the rent. While the landlord doesn’t have to prorate the rent, they might be willing to work with you since they don’t want the unit sitting empty. If the landlord agrees to prorating the rent, get it in writing – preferably as a clause in the lease agreement.
If you are currently renting and think you might need prorated rent at the end of your lease term, review your lease agreement to see if there’s a prorated rent clause. If there isn’t, discuss it with your landlord and see if you can amend your current lease agreement.
