Common Rental Scams: 5 Questions to Ask When Choosing a Property
Looking for a rental can be an arduous process when everything goes smoothly, but when scams are factored into the equation, this can be a huge stressor. Fortunately, there are some telltale signs a rental listing is a scam. Here are five red flags that signal a rental listing is probably not legitimate.
Is the Property Too Cheap?
Like with many other things in life, if a monthly rate sounds too good to be true, it probably is. Occasionally an owner might be desperate to rent a property and lower the price, but this isn't usually the case. Research the real estate market in the area; if a house, condo, or apartment is priced well below all other listings in the area with the same space and amenities, it's a strong red flag. Many scammers will undercut the price to attract attention and get people interested. Once they got a victim hooked, they'll go for the money grab and skip town.
Is the Listing a Duplicate? Does it Have Errors?
Rental scammers often duplicate another listing and alter the contact information. If a listing is too similar to one or more other listings, beware. Chances are it's a scammer looking to make a quick buck by victimizing people seeking a rental. Additionally, any rental listing that is littered with errors or poor grammar should be viewed with suspicion. Rental scammers may not pay too close attention to this. Owners or operators of legitimate properties will scrutinize listings to ensure they are accurate and error-free.
Does the Property Manager Refuse to Meet in Person?
Scammers will actively avoid meeting the people they want to “rent” to because this means they can be identified. Instead, they'll use excuses and say they have to work late or are currently out of town and unable to make an appointment. Legitimate landlords or property managers are typically eager to meet with the people they'll rent to. They do this to protect their property interests because they'll want to know they are renting to a trustworthy tenant. Almost all legitimate rentals will involve some tenant screening.
Does the Property Manager Ask for Rent or a Deposit Before Signing a Lease?
Any person claiming to a landlord, property manager, attorney, or real estate agent who asks for money upfront before signing a formal lease agreement is pulling a fast one. Large sums of money should never be exchanged before an agreement is signed. Some rentals will require application fees to cover background checks and other administrative tasks, but these costs should be minimal.
Does the Property Manager Want to Rent the Property Sight Unseen?
The bolder scammers will agree to meet in person but refuse to show the interior of the property. They might allow prospective tenants to tour the outside but will come up with an excuse not to show the inside. If this occurs, it is almost 100% a scam. Some scammers will send an “attorney” or another representative to give tenants a key. Most often, this is a phantom key to a phantom property. Prospective tenants should never send money to anyone that doesn't meet directly and show the property in person.
What to Do in the Event of Fraud
In the event a person falls victim to a rental scam, they should be sure to take the following steps:
- Call local authorities
- Report the scam to the listing website
- Contact the U.S. Federal Trade Commission to report the scam
Unfortunately, scammers often try to take advantage of people looking to rent a property. However, by knowing how to quickly recognize the red flags associated with the most common rental scams, prospective tenants can avoid falling victim.