Reducing Rental Initial Costs with Installment and Deferred Payment Plans — Comprehensive Guide to Services, Screening, and Important Considerations

Why Are Rental Initial Costs So High?

When renting a property, the following costs come due all at once:

Combined, these costs can easily total 3–6 months' rent. When moving expenses and furniture/appliance purchases are added, the total initial costs can exceed ¥500,000–1,000,000.

To lower this barrier, installment and deferred payment services have become increasingly popular.

How Installment and Deferred Payment Services Work

Splitting Costs via Credit Card Payments

Some real estate agencies accept credit card payments for agency fees, guarantor company fees, and other charges, allowing you to use your card's installment or revolving payment options.

Benefits:

• •You earn card points
• •The process is straightforward

Drawbacks:

• •Many real estate agencies don't accept card payments
• •Revolving payments carry high fees (roughly 15% annual percentage rate)

Deferred and Installment Services Designed for Initial Rental Costs

In recent years, services specifically designed for rental initial costs have emerged.

Representative Examples:

• •smooth: A service that lets you split initial costs into up to 12 installments. Available when real estate agencies use it. Fees are calculated as a fixed rate based on the number of installments.
• •Dandori Barai: A service that allows installment payments for initial costs, evening out your monthly burden.
• •ROOM iD: A service that advances your initial costs and offers installment payments.

These services are not available at all properties or agencies—they're limited to partner management companies and properties.

Using Consumer Finance or Personal Loans

You can also borrow initial costs through a personal loan or consumer finance company, pay them all at once, and repay the loan in installments.

Benefits:

• •You can choose any property or agency

Drawbacks:

• •Interest rates are high (roughly 3–18% annual percentage rate)
• •If repayment plans fall apart, you risk multiple debts

Using Zero-Deposit, Zero-Key-Money Properties

Without using installment services, you can choose "zero-deposit, zero-key-money properties" to significantly reduce initial costs. However, exit fees tend to be higher, so always check the special terms in your lease agreement.

Important Considerations When Using Installment and Deferred Payment Services

Confirming Fees Is Essential

Installment services charge fees. Even if they appear free, fees may be added to your rent. Compare the real cost of services before choosing.

There Is a Screening Process

Installment services for initial costs also require approval. If there are issues with your credit history, you may not pass the screening.

Risk of Nonpayment During Installments

Since monthly installment payments are added to your rent, your total monthly payments increase. Carefully consider your income and expenses before using the service.

Limited to Specific Management Companies and Properties

Installment services for initial costs can usually only be used at properties managed by partner real estate agencies. Check in advance whether your desired property qualifies.

Other Ways to Reduce Initial Costs

Beyond installment payments, there are other ways to reduce initial costs.

Choose the Right Timing

During slack seasons like June–August and November–January when moving demand is low, landlords are more likely to waive key money or negotiate on rent.

Using Housing Stabilization Allowances

If you've experienced job loss or reduced income, you may qualify for your local municipality's Housing Stabilization Allowance. Your rent may be subsidized for up to 9 months.

Employer Housing Allowances and Moving Assistance

If you're relocating for a job change or transfer, maximize your employer's moving assistance and housing allowances. Many companies cover part of the initial costs.

Summary

Rental initial cost installment services are a strong option if you don't have a lump sum available but want to move into your desired property. However, because there are drawbacks—including fees, screening requirements, and limited eligible properties—it's important to carefully compare services before deciding. By combining installment options with zero-deposit properties and strategic timing, you can smartly reduce your initial cost burden.