Can landlord/property change unit after approval and payment of fees?
"Without the specifics of the contract, as well as the specifics of the country/state/city you're moving to, it's hard to say what's legal.  But this also isn't law.se, so I'll answer this from the point of view of personal finance, and what you can/should do as next steps. Whenever paying an application fee or a deposit, you need to ensure that you have in writing exactly what you're applying for or putting a deposit in for.  Whether this is an apartment, a car, or a loan, before any money changes hands, you need to get in writing exactly what you're putting that money to. So for a car, you'd want to have the complete specifications - make, model, year, color, extra packages, and any relevant loan information if applicable.  You wouldn't just hand a dealer $2000 for ""a Toyota Camry"", you'd make sure it was specified which one, in writing, as well as the total you're expecting to pay.  Same for an apartment: you should have, in writing (email is fine) the specific unit you are putting a deposit for, and the specific rate you'll be paying, and the length of time the lease is for. This is to avoid a common tactic: bait and switch, which is what it looks like you've run into.  A company puts forth a ""nice"" model, everything looks good, you get far enough in that it seems like you're locked in - and then it turns out you're really getting a less nice model that's not as ideal as whatever you signed up for.  Now if you want to get what you originally signed up for you need to pay extra - presumably ""something was wrong in the original ad"", or something like that.  And all you can hear in the background is Darth Vader... ""I am altering the deal. Pray I don't alter it any further."" So; what do you do when you've been bait-and-switched? The best thing to do is typically to walk away. Try to get your application fee back; you may or may not be able to, but it's worth a shot, and even if you cannot, walk away anyway. Someone who is going to bait-and-switch on you is probably not going to be a good landlord; my guess is that rent is going to keep going up beyond the level of the market, and you probably can kiss your security deposit goodbye. Second, if walking away isn't practical for whatever reason, you can find out what the local laws are. Some locations (though very few, sadly) require advertised prices to be accurate; particularly the fact that they re-advertised the unit again for the same rate suggests they are falling afoul of that. You can ask around, search the internet, or best yet talk to a lawyer who specializes in this sort of thing; some of them will be willing to at least answer a few questions for free (hoping to score your business for an easy, profitable lawsuit). Be aware that it's not exactly a good situation to be in, to be suing your landlord; second only to suing your employer, in my opinion, in terms of bad things to do while hoping to continue the relationship.  Find an alternative as soon as you can if you go this route. In the future, pay a lot of attention to detail when making application fees.  Often the application fee is needed before you get into too much detail - but pick a location that has reasonable application fees, and no extras.  For example, in my area, it's typical to pay a $25 application fee, nonrefundable, to do the credit check and background check, and a refundable $100-$200 deposit to hold the unit while doing that; a place that asks for a non-refundable deposit is somewhere I'd simply not apply at all."
A lot of people do this. For example, in my area nice townhouses go for about $400K, so if you have $80,000 you can buy one and rent it. Here are the typical numbers: So you would make $350 per month or $4,200 per year on $80,000 in capital or about 5% profit. What can go wrong: (1) The property does not rent and sits vacant. You must come up with $2100 in mortgage payments, taxes, and insurance every month without fail or default. (2) Unexpected expenses. A new furnaces costs over $5,000. A new roof costs $7,000. A new appliance costs $600 to $2000 depending on how upscale your property is. I just had a toilet fixed for a leaky plunger. It cost me $200. As you can see maintenance expenses can quickly get a lot higher than the $50 shown above... and not only that, if you fix things as cheaply as possible (as most landlords do), not only does that decrease the rentability of the property, but it causes stuff to break sooner. (3) Deadbeats. Some people will rent your property and then not pay you. Now you have a property with no income, you are spending $2100 per month to pay for it, AND you are facing steep attorney fees to get the deadbeats evicted. They can fight you in court for months. (4) Damage, wear and tear. Whenever a tenant turns over there is always a lot of broken or worn stuff that has to be fixed. Holes in the wall need to be patched. Busted locks, broken windows, non-working toilets, stains on the carpet, stuck doors, ripped screens, leaky showers, broken tiles, painting exterior trim, painting walls, painting fences, etc. You can spend thousands every time a tenant changes. Other caveats: Banks are much more strict about loaning to non home owners. You usually have to have reserve income. So, if you have little or no income, or you are stretched already, it will be difficult to get commercial loans. For example, lets say your take-home pay is $7,000 and you have no mortgage at all (you rent), then it is fine, the bank will loan you the money. But lets say you only have $5,000 in take home pay and you have an $1,800 mortgage on your own home. In that case it is very unlikely a bank will allow you to assume a 2nd mortgage on a rental property. The more you try to borrow, the more reserve income the bank will require. This tends to set a limit on how much you can leverage. I assume having real estate in a good popular city is much more secure way of keeping money than having it in a bank account Not at all!  Many things can go wrong with rental property. Renters can be late on rent, they can cause damage to property, you can have unexpected repairs. I'm not saying that you should just let it sit, but rental property is not risk-free my any means. Are you prepared to be a landlord as a part time job (for 500/mo?).  Rental property is not passive income - it takes work to maintain.  You can outsource this to a property manager, but that eats into the 500/mo that you are estimating). I want to stay flexible and have a possibility to change my location whenever I want. That's a perfectly reasonable reason not to buy a home, but what will you do with the rental when you move? It will still need maintenance, you'll still need to interact with renters, etc. I'm not saying you shouldn't do this, but I get the feeling that you are not fully aware of the risks involved in rental properties. i would recommend that you establish a landlord/tenant relationship instead of joint ownership (ie 100% ownership stake for one of you vs 0% for the other). it is much cleaner and simpler.  basically, one of you can propose a monthly rent amount and the other one can chose to be either renter or landlord. alternatively, you can both write down a secret rental price offer assuming you are the landlord, then pick the landlord who wrote down the smaller rental price.  if neither of you can afford the down payment, then you can consider the renter's contribution an unsecured loan (at an agreed interest rate and payment schedule). if you must have both names on the financing, then i would recommend you sell the property (or refinance under a single name) as quickly as possible when the relationship ends (if not before), pay the renter back any remaining balance on the loan and leave the landlord with the resulting equity (or debt).  in any case, if you expect the unsecured loan to outlive your relationship, then you are either buying a house you can't afford, or partnering on it with someone you shouldn't. What kind of financial analysis would make you comfortable about this decision? The HELOC and ARM are the biggest red flags to me in your current situation.  While I don't expect interest rates to skyrocket in the near future, they introduce an interest rate risk that is easy to get rid of.  Getting rid of the HELOC and converting to a fixed mortgage would be my first priority. If you also want to upgrade to a new home at the same time (meaning buy a new home contingent on the sale of your first, paying off the HELOC and mortgage), that's fine, but make sure that you can comfortably afford the payment on a fixed-rate mortgage with at least 20% down. I would not take additional cash out of your equity just to save it.  You're going to pay more in interest that you're going to get in savings.   From there things get trickier.   While many people would keep the first property on a mortgage and rent it out, I am not willing to be a landlord for a part-time job, especially when the interest on the mortgage gouges my return on the rent.  PLus leverage increases the risks as well - all it takes is to go one or two months without rent and you can find yourself unable to make a mortgage payment, wrecking your credit and possibly risking foreclosure. So my options in order of precedence would be: At what point does it make sense to become a landlord? The complicated answer is when the benefits (rent, appreciation) relative to the costs (maintenance, interest, taxes, etc.) and risks (lost rent, bad renters, home value variance) give you a better return that you could find in investments of similar risk.  The simple answer is when you can pay cash for it.  That takes interest and lost rent out of the equation.   Again, some are willing to take those risks and pay 20% down on rental property.  Some are able to make it work.  Some of those go broke or lose their properties.   when calculating the 20% down of a new property, does that need to be liquid funds, or can that be based on the value of the home you are selling You can make the purchase of the new home contingent on the sale of the first if you need to get the equity out of it to make the 20%.  Do NOT refinance the first just to pull out the equity to make a down payment.  It's not worth the fees of a refinance. "I don't know how many people ""a ton"" is, but if you are getting more than, say, 6 people who are qualified to rent, you've priced it too low. Better to ask for $1200, and have a potential tenant haggle or ask you to reduce the price than to have 6 people want it for $900.  It's worth it to run a credit report, and let that help you choose. I agree with Victor, a bidding war is appropriate for a house sale, not rental apartments.  You didn't mention your country, but I'd be sure to find out the local laws regarding tenant choice. You may not (depending where you are) discriminate based on gender, sexual orientation, marital status, race, or religion." Yes, you may do this at any time before signing - but to make a change like this after the official loan documents have been drawn up will cost you extra fees.  The typical redraw fee is around $200 in CA.   Does it make sense to do so?  No, it does not.  If you have an extra 1%, it would probably be better to use that money to purchase a lower interest rate.  Here's an example: Let's say you're buying a $200,000 house and your offered interest rate is 4.75% (just an example).   With 10% down you'd have a loan amount of $180,000 and a p&i payment of $938.97 per month.   With 11% down you'd have a loan amount of $178,000 and a p&i payment of $928.53 per month. Now let's pretend you buy your interest rate down to 4.375%.  With 10% down you'd still have a loan amount of $180,000 but your p&i payment would be $898.71 per month.   Even though the last option gives you the best payment, if I were in your shoes I'd stick with the 10% down and save that extra cash in the bank for a rainy day.  Buying a home comes with a lot of new expenses and many are unexpected. Good luck! "Disclaimer: I am a law student, not a lawyer, and don't claim to have a legal opinion one way or another. My answer is intended to provide a few potentially relevant examples from case law in order to make the point that you should be cautious (and seek proper advice if you think that caution is warranted). Nor am I claiming that the facts in these cases are the same as yours; merely that they highlight the flexible approach that the courts take in such cases, and the fact that this area of law is complicated. I don't think it is sensible to just assume that there is no way that your girlfriend could acquire property rights as a rent paying tenant if arranged on an informal basis with no evidence of the intention of the arrangement. One of the answers mentions a bill which is intended to give non-married partners more rights than they have presently. But the existence of that bill doesn't prove the absence of any existing law, it merely suggests a possible legal position that might exist in the future. A worst-case assumption should also be made here, since you're considering the possibility of what can go wrong. So let's say for the sake of the argument that you have a horrible break up and your girlfriend is willing to be dishonest about what the intentions were regarding the flat (e.g. will claim that she understood the arrangement to be that she would acquire ownership rights in exchange for paying two thirds of the monthly mortgage repayment). Grant v Edwards [1986] Ch 638 - Defendant had property in the name of himself and his brother. Claimant paid nothing towards the purchase price or towards mortgage payments, but paid various outgoings and expenses. The court found a constructive trust in favor of the claimant, who received a 50% beneficial interest in the property. Abbot v Abbot [2007] UKPC 53, [2008] 1 FLR 1451 - Defendant's mother gifted land to a couple with the intention that it be used as a matrimonial home. However it was only put into the defendant's name. The mortgage was paid from a joint account. The claimant was awarded a 50% share. Thompson v Hurst [2012] EWCA Civ 1752, [2014] 1 FLR 238 - Defendant was a council tenant. Later, she formed a relationship with the claimant. They subsequently decided to buy the house from the council, but it was done in the defendant's name. The defendant had paid all the rent while a tenant, and all the mortgage payments while an owner, as well as all utility bills. The claimant sometimes contributed towards the council tax and varying amounts towards general household expenses (housekeeping, children, etc.). During some periods he paid nothing at all, and at other times he did work around the house. Claimant awarded 10% ownership. Aspden v Elvy [2012] EWHC 1387 (Ch), [2012] 2 FCR 435 - The defendant purchased a property in her sole name 10 years after the couple had separated. The claimant helped her convert the property into a house. He did much of the manual work himself, lent his machinery, and contributed financially to the costs. He was awarded a 25% share. Leeds Building Society v York [2015] EWCA Civ 72, [2015] HLR 26 (p 532) - Miss York and Mr York had a dysfunctional and abusive relationship and lived together from 1976 until his death in 2009. In 1983 Mr York bought a house with a mortgage. He paid the monthly mortgage repayments and other outgoings. At varous times Miss York contributed her earnings towards household expenses, but the judge held that this did ""not amount to much"" over the 33 year period, albeit it had helped Mr York being able to afford the purchase in the first place. She also cooked all the family meals and cared for the daughter. She was awarded a 25% share. Conclusion: Don't make assumptions, consider posting a question on https://law.stackexchange.com/ , consider legal advice, and consider having a formal contract in place which states the exact intentions of the parties. It is a general principle of these kinds of cases that the parties need to have intended for the person lacking legal title to acquire a beneficial interest, and proof to the contrary should make such a claim likely to fail.  Alternatively, decide that the risk is low and that it's not worth worrying about. But make a considered decision either way." The problem is that you don't have the money now; so they can't know with 100% certainty that you will have it on settlement day.  What happens if you don't file the paperwork in time? or you change your mind because you think the company stock is going to go through the roof next quarter? They would have to pull the funding for the loan. The seller would be upset, and could even file for damages if the deal falls through.  It could even snowball because if they delay the sale then they can't buy the new place, which impacts another closing... Frequently lenders want to see the money for the down payment long before settlement.  They want to know the money is there, and it isn't a hidden loan. While you can point to the money in the ESPP, they would still like to see the money in a regular bank account. Even if you do convince them to delay their evaluation you can count on being asked to prove the existence of the funds in the days before closing, or they will delay giving the loan.