Earlier this year, I received several calls asking about a home that I had sold back in the summer of 2023. This property was being advertised as available for rent, using photos from my previous listing. The unusually low rent price and terms raised a lot of suspicion, prompting some potential renters to contact me. This led me to investigate and eventually find out that this was a rental scam. The scam involved advertising the property at extremely low rates and then insisting on advanced payments without an opportunity to view the property. After seeing how many renters were enticed by this, it really opened my eyes to the potential number of other renters out there being scammed. As an experienced real estate professional, I’m here to share a few tips to help you recognize and steer clear of these types of scams.
Key Red Flags to Watch Out For
The High-Pressure Rental
You should exercise extreme caution with “landlords” who press you to act quickly without first showing you the property. In the case I was involved with, potential renters were told they needed to put down two months’ rent to secure the property and that they needed to move quickly; otherwise, the property would be gone. Legitimate landlords will allow you to tour the property and won’t have any reason to rush you. They will typically vet the applicants and select the most financially secure tenant.
Payment Before Paperwork
Never put down a deposit or pay rent before signing a lease. In the normal lease process, you will always sign a formal lease agreement prior to any financial exchange. This ensures that your rights and obligations, as well as those of the landlord, are clearly defined and legally binding.
Suspiciously Low Prices
An offer that seems too good to be true often is. Scammers use low prices to quickly lure as many potential renters as possible. Always compare the price with other local properties to ensure it’s reasonable. If you have questions, talk to a realtor. They should be able to provide rental comps for the areas you are interested in.
Error-Ridden Listings
Authentic landlords invest time in their listings so they typically don’t have many mistakes. Be leery if you see a listing full of grammar and spelling errors.
No Screening Process
All landlords have a screening process for their tenants. They are looking to protect their investment so it’s critical they choose a financially strong tenant. You should be very suspicious if they do not require a screening.
Vague Lease Agreements
Avoid signing leases that are incomplete or unclear. A thorough lease is crucial for protecting both you and the landlord.
Listing Disappears
Check the listing multiple times to see if it is still on Zillow, Redfin, or whatever site you found it at. A scammer will often post the listing just long enough to get a few calls and then take the listing down.
How to avoid a rental scam
Do Your Research
Conduct thorough research on any property you’re interested in. Start by verifying the authenticity of the listing on multiple platforms such as Zillow, Redfin, or Apartments.com. Look for consistent information across different sites and compare the rental rates with other similar properties in the area to ensure they’re reasonable. Research the owner or property management company by looking them up online and reading reviews or complaints. This can provide insight into their reputation and legitimacy.
Meet the Landlord
Personal interaction can reveal a lot about the legitimacy of a rental situation. You should meet the landlord or property manager in person or a live video call if a physical meeting isn’t possible. A genuine landlord will be willing to meet and discuss the property. During the meeting, ask detailed questions about the property and the terms of the lease. This can help you gauge their professionalism and legitimacy.
Inspect Before Committing
Never agree to rent a property without inspecting it personally. Most online scammers will not have physical access to the property and will try to take your money without seeing the property. Visiting the property allows you to confirm its existence, evaluate its condition, and ensure it matches the description in the listing. If a landlord resists or makes excuses for why you can’t view the property, it is a major red flag.
Consult a Realtor
A realtor with experience in rentals can be an invaluable resource in your search. They have access to legitimate listings and can help you navigate the rental market more safely. Realtors are familiar with the landlords, management companies and average rental prices in the area. They can also assist you in reviewing the lease agreement to ensure it’s fair and comprehensive.
What to do you if you’re scammed
Report Immediately
If you suspect that you’ve been scammed, report it immediately to local law enforcement. Providing them with all the information about the scam can help them investigate and possibly prevent others from falling victim. Document all communications, payments, and other interactions you’ve had with the scammer. This documentation can be vital in an investigation.
Inform Relevant Agencies
In addition to local authorities, report the scam to the Federal Trade Commission (FTC) through their official website at ReportFraud.ftc.gov. The FTC is responsible for handling consumer complaints and can take action against widespread fraud. Also, file a complaint with the Internet Crime Complaint Center (IC3), a partnership between the FBI and the National White Collar Crime Center. Reporting to these agencies helps them gather data on scams and can lead to broader measures to prevent such fraudulent activities. Additionally, inform the website or platform where the listing was posted, so they can remove it and improve their measures to prevent future scams.
In conclusion
While rental property scams pose a significant threat, staying informed and vigilant is your best defense. If an offer appears too good to be true, it probably is. Always trust your instincts and, when in doubt, err on the side of caution. Wishing you a safe and successful property hunting journey!