8 Red Flags to Help You Spot a Rental Scam

With just about every rental search beginning online these days, it’s a given that con artists will try to take advantage of eager consumers. Combine fake listings with rental brokers looking to pull bait-and-switch operations with rentals of lower quality or higher rent, and you’ll have a hard time believing which listings are real.

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Even on the phone, scammers will try to get you to give financial or personal information regarding a rental. Housing-related scam calls increased 300% in May 2022, according to First Orion, a branded communications and call protection solutions company based in North Little Rock, Arkansas. Those high numbers appear to have held fairly steady since, says First Orion’s chief data officer Kent Welch.

The Federal Trade Commission warns consumers about rental listing scams as a common danger on its website, instructing individuals to report suspected scams to the site the listing was posted on, as well as local law enforcement and the FTC.

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Major red flags that can help you identify rental scams include:

— The listing photos have an MLS watermark.

— The listing details are vague.

— They don’t want to show you the place first.

— They’re ready to make a deal with no background info.

— They’re out of the country.

— They want you to sign or pay right away.

— The asking rent doesn’t match up.

— They instruct you to wire money.

The Listing Photos Have an MLS Watermark

If the rental listing’s photos sport a watermark — which is used to identify the owner of the photo — proceed with caution. Scammers sometimes illegally pull photos from the local multiple listing service, where properties are listed for sale by real estate professionals. When a photo appears with an MLS watermark, the person who posted the rental doesn’t have the original photo because he or she isn’t actually associated with the property.

The FTC warns that scammers will commonly copy a rental advertisement word-for-word as well, merely changing the email address or phone number associated with the listing and posting it on a different site. Property owners, agents or residents often don’t find out the address and photos have been used until a victim shows up at their door, thinking they’re moving in.

The Listing Details Are Vague

Not everyone is great at writing a rental description, but if basic details seem overly vague or don’t quite make sense, it’s probably because the person who posted the property has never been there. Omitting details on utilities or mentioning an attraction that’s more than a mile away as being within walking distance can indicate that the poster isn’t familiar with the area or doesn’t expect you to be familiar with it.

They Don’t Want to Show You the Place First

If you reach out about an online rental listing and the person who responds doesn’t immediately ask to show you the available space or at least discuss options for a virtual or video tour, consider it a telltale sign that he or she has no association with the property. Scammers could also pretend to be a renter interested in a sublease or lease with a small-time landlord, aiming to get financial information. If they have no interest in learning more about the property or coming to see it first, it may be a scam.

If you received a call and are worried the person isn’t legitimately renting or even associated with a rental you inquired about, offer to call them back at their posted phone number and then ask to tour the property. “People will spoof the (legitimate) number — initiate the call yourself,” Welch says.

They’re Ready to Make a Deal With No Background Info

You want a landlord or property manager who seeks reliable tenants. If a supposed landlord asks you to sign a lease with only email communication and no background on your financial stability, he or she is likely looking to get a one-time payment from you and may disappear before you move.

The FTC warns against paying a security deposit or first month’s rent before you’ve signed a lease and met the landlord in person. You should never submit any amount beyond an application fee before you’ve confirmed the space is available, the individual you’re working with is associated with the property and the contract makes you the legal tenant.

Mayank Gupta, co-founder and CEO of Dispute, a company created to help people pursue small-claims cases like rental scams and landlord-tenant disputes, stresses you should be able to identify the person you’re talking to as well. “Ask the person for a photo ID copy — if you’re about to send thousands of dollars to someone, it’s reasonable to ask who they are,” Gupta says.

They’re ‘Out of the Country’

The reason many scammers give that they can’t meet with you in person is they’re temporarily out of the country. As the FTC reports on its website, scammers may even make it seem realistic: “It might even involve a lawyer or an ‘agent’ working on their behalf. Some scammers even create fake keys,” and send them to you in the mail.

They Want You to Sign or Pay Right Away

Scammers work best by creating a sense of urgency to make you think providing money immediately is necessary, whether it’s to get the lease before another renter, avoid getting evicted or stop a utility shutoff. “They’re going to try to rush you into a decision. They’re going to try to get money from you, or at least some personal information,” Welch says.

Even if the scammer isn’t successful at getting you to wire money or provide a credit card number over the phone or text, Welch says scammers will create a profile of you. “They can (try to) get your mother’s maiden name on one call, your Social Security on another,” he says. The calls may not even seem related, but if you’ve had more than one suspicious call recently, be wary.

The Asking Rent Doesn’t Match Up

Con artists and shady brokers will hook many victims with the promise of rent that can almost seem too good to be true. “The price is really good, and then it just turns out to not even exist,” Gupta says.

If you’re looking at rentals in a certain neighborhood and spot one for a few hundred dollars less than the rest, proceed cautiously. Chances are it’s either a fake listing or a fake rental rate to try to draw you in.

They Instruct You to Wire Money

Nigerian prince or not, any request for you to wire the security deposit or first month’s rent is a clear sign of a scam. Once the money has been collected, there’s no way for you to get it back, and the person you thought you were in contact with can easily disappear.

But don’t assume you’ve outsmarted all fraudsters. Con artists may simply try harder to trick you.

Gupta recommends offering to mail a check — or better yet, hand it over in person — rather than wire any money. Even if it does turn out to be a scam, you then have a name to start with to pursue legal action.

How to Avoid Rental Scams

Research the Landlord

With a simple Google search, you can find out if the person is associated with the area, or even if they’ve been named in scams in the past by news outlets, local law enforcement or previous victims.

Verify the Address

This helps you avoid a bait-and-switch from an agent who’s trying to get you to accept another apartment. Search the address online to see if the property is listed for sale by a different real estate agent or if the rental shows different contact information elsewhere, which is a sign that someone is using the property as a scam.

Check Street Views of the Property

When you look at the property on an online map, click on the street view option to see if the property matches the exterior photo in the listing.

Visit and Tour the Rental

If you do this, you’re also more likely to notice other details that may be deal breakers for your next home, like an aggressive neighbor dog, a busy street or poor upkeep.

Meet in Person

Many scammers are unwilling to meet in person, and if you do so for an apartment tour, you’ll be able to get proof of access to and knowledge of the property as you walk around and ask questions.

Use a Real Estate Agent

If you’re worried about getting scammed or need some additional help finding the right rental, it may make sense to find a real estate agent near you. A good agent familiar with the surrounding area will be able to spot scammers, plus they won’t let you rent a complete dump without your say so.

[Should You Use a Real Estate Agent to Find Your Next Rental?]

How to Report a Rental Scam

A scam meaning to cheat you out of money should be reported to the police. Provide a screenshot of the rental listing and any emails you exchanged with the individual. Additionally, report the listing to the website where it’s advertised, and report fraud to the FTC.

Despite your diligence, you may find yourself the victim of a scam that leaves you without hundreds or even thousands of dollars. “Don’t be embarrassed, these guys are professionals, they’re really good at what they do,” Welch says. “I’m in the business of identifying these scams and I see some and think, ‘Man, I might have believed that.'”

Report to your bank and credit card companies as soon as you can to potentially freeze accounts or cancel charges as fraudulent.

You can often pursue damages in small claims court. Small claims court does not require a lawyer to represent you, but preparation is key. Your state’s process for filing a suit against an individual or company can likely be found online — and be sure to follow every required step. You can opt to hire a lawyer or use a company like Gupta’s, Dispute, for filing assistance and resources to pursue legal action in small claims court.

More from U.S. News

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8 Red Flags to Help You Spot a Rental Scam originally appeared on usnews.com

Update 05/02/23: This story was published at an earlier date and has been updated with new information.

Correction 10/04/22: A previous version of this story incorrectly stated Kent Welch’s title. He is the chief data officer at First Orion.

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