5 Tips to Help You Avoid Becoming a Rental Scam Victim

Internet-originating scams are not uncommon. From work-at-home scams to phishing scams to email lottery scams, some are more obvious while others, such as apartment rental scams, are less obvious but can still rob you of your hard-earned money.

Whether you are a tenant looking for apartments for rent or a landlord looking for a new tenant, here are five tips to help you avoid getting scammed:

1. Remember the mantra, “If it seems too good to be true, it probably is.”

If the going rate for a 2-bedroom, 2-bath home in your preferred neighborhood is $1,000 per month, be very cautious of listings for the same size/amenities priced significantly lower. It may be that the home is a dump, it may be the home is in a bad location, but it’s most likely a scammer is trying to bait you with a super-low price to a property they don’t own. Their goal is to make contact with you in hopes of getting a credit card number, Social Security number or any other personally identifying property to “hold the property.” If it sounds too good to be true, it probably is. Keep that mantra in the back of your head.

2. Carefully analyze email correspondence for red flags.

If you’re a renter or a landlord, watch out for these red flags:

  • Overseas emails, especially those originating in well-known scamming countries like Nigeria that show interest in renting your home. Oftentimes there will be a far-fetched story to go along with the email. For landlords, be aware of the renter email that explains they are coming to the U.S. to work for a large, reputable company, or are going to school in the U.S. There are many variations to this scam, but one example is the renter will send a cashier’s check for an amount larger than required. You then go to the bank, deposit the check and send the excess funds either back to the tenant or to another party only to find out days later that the original cashier’s check is fake and that your bank wants you to pay them back. Another scam is when people pose as landlords and ask that you wire them rent money in exchange for the keys. You wire the money, but the keys are not sent; or, the keys arrive, but they are a fake set.
  • Over-the-top emails. Whether it is a promise to pay more than the agreed upon rent or one referring to you as their dearest friend after just one email exchange, be cautious of odd, inappropriate or over-the-top emails.
  • Claiming to be someone they are not. For the most part, kings, queens, princesses and sons of diplomats will not contact you about  your $1,000 per month home. People of that stature do not do the work for themselves and typically have no desire to move to Your Home, USA. Scammers also may use other, less obvious aliases such as titles of U.S. overseas military personnel or clergy with the intent of making you feel safer when communicating with them.
  • Bad English. Poorly written property advertisements or email communication with major grammar or capitalization errors should trigger a red flag on both the landlord and tenant side. This may be a sign that the landlord  or tenant is not as ‘local’ as they say they are.

3. Make sure that the property you are interested in is legitimately for rent. With the number of vacant homes and displaced homeowners on the rise due to foreclosure, there is a large market for scammers. Nowadays it is not uncommon to hear stories about scammers renting out homes that do not belong to them. Typically, scammers will find bank-owned homes that have sat vacant for awhile, break in, change the locks and rent them out as their own. Homes may be rented for weeks or even months until the bank or real estate agent assigned to sell the property discovers what has happened. Eventually the tenant will be served with a trespassing notice and be forced to leave the premises with 72 hours. Before you rent out a home and hand over your money, do an address and landlord search on the Internet to look for irregularities. Check to see if the owner’s name matches the name for the home at the county assessor’s office. Lastly, be bold and ask the neighbors if they know who lives there.

4. Use a reputable source in your search for rental listings. Online rental listing sources such as Zillow.com require that landlords pay a monthly premium to post homes for rent. This not only prevents stale listings, but is also serves as a deterrent to potential scammers who may be looking to make money without having to spend it first.

5. Finally, if someone asks you pay rent without seeing the property and signing a lease, don’t do it. As a renter, under no circumstances should you be required to pay a rental fee to the landlord before being allowed to view the property. Doing so may result in the loss of your money even if you are using a reputable payment source; even PayPal will not reimburse you when real estate-related transactions go bad. In addition, as a landlord you should never help a future tenant relay money to yourself or other parties via money transfers, cashiers checks or wires. As a note of caution, the most-trafficked avenues for scammers dealing with the exchange of funds are money transfers, cashiers checks or wires. This is because they are hard to track, can be collected anywhere in the world and can be easy to forge.

As a rule of thumb it is always best to refrain from giving out any personally identifiable information or credit card/bank information over the Internet or phone, especially if the situation doesn’t feel quite right. If you have fallen victim to Internet fraud or have been preyed upon by an Internet scammer you can file a complaint at the Internet Crime Complaint Center.

> See additional tips on avoiding Internet scams

> See other types of real estate scams