A Guide to Recognizing and Avoiding Rental Scams

As a renter, it’s important to know how to protect yourself against those who may try to take your money fraudulently. This means knowing how to spot and avoid rental scams, especially online. While the internet has increased flexibility and ease in finding apartments for rent from trusted sources, unfortunately, it has also created an environment in which scammers thrive. Plus, in 2020, a massive shift to heavy reliance on virtual property tours and online research has created new opportunities for scammers to take advantage of renters. Luckily, it’s easy to understand how to report rental scams as well.

Since the beginning of 2020, local Better Business Bureaus have issued warnings in multiple areas across the country regarding a spike in rental scams. Local authorities have also cautioned renters to pay even more attention when apartment-hunting because scammers are using social distancing as an excuse to avoid showing apartments and promote fraudulent rental listings. As a result, rental scams have been identified in every corner of the country — from Boston to San Diego and from Arizona to Washington state.

To help you better recognize and know how to avoid rental scams, we’ve put together this comprehensive guide with everything you need to know about such traps.

Navigate the contents:

• What is a Rental Scam?
• Types of Rental Scams
• How to Spot a Rental Scam
• How to Avoid Rental Scams
• How to Report Rental Scams
• Expert Advice on Rental Scams

What is a Rental Scam?

According to the U.S. government, a rental scam is when “either a property owner or potential tenant misrepresents themselves” through false ads, applications and so on. While there are other types of scams, today we’ll focus on how to spot rental scams as a potential tenant and how to protect yourself against such risks. Unfortunately, there are a variety of ways in which scammers try to steal your money, primarily through either a non-existent rental or via a stolen ad from another website.

Types of Rental Scams

Among the various types of rental scams to watch out for are hijacked ads and phantom rentals. These are often prominent on Craigslist, where there are no filters to help you find legitimate listings.

• Hijacked Ads

In some cases, scammers will steal an ad from an existing rental and revise the contact information so that you reach them when trying to contact the owner. These copycat ads will appear on different websites, as well, so make sure you check to see whether the internet listing service you’re using has trustworthy listings.

Another way scammers hijack ads is by gaining access to the email accounts of various property owners. Therefore, it’s important to confirm who you are talking to.

• Phantom Rentals

Other scammers simply create a fake ad on a non-existent rental and promote it as real. Typically, these are the ones that have a significantly lower rent than average or amenities that should raise the price. If an offer looks too good to be true, find out what caused that drop in price and always check out the apartment with your own eyes before committing and sending any money.

Another scam that’s common on Craigslist is illegal subletting. Be careful about this one. Unlike the others, these scammers will have access to a rental to show you — but they’re not the legitimate owners and have no right to rent it to you. To avoid this situation, check if the apartment is managed by a reputable company.

How to Spot a Rental Scam

There are plenty of other ways in which you can be deceived into thinking a rental is legitimate when, in fact, the person you’re talking to has no intention of renting it to you. If you want to know how to avoid rental scams, it’s firstly important to know how to spot them. Pay attention to these red flags when discussing a rental with a potential landlord:

1. They Refuse to Meet You

Scammers usually steer clear of meeting with you because they want to minimize the chance of being identified. As such, they will refuse to meet with you in person or — in the context of the pandemic — even show their face during a video call. This is a red flag because a legitimate landlord would want to meet their potential tenant and evaluate you, as well, in order to establish the required level of trust between the owner and the occupant of a home.

2. They Ask You to Wire Money

A major warning sign is when someone asks you for money up-front — before you’ve signed anything. For instance, a scammer might claim that they’re not in the country and require you to mail them money with the promise that they’ll mail you back a key. Don’t do it. Instead, cease all communications and report it as a scam. Furthermore, wait to pay your security deposit, rent, and any other fees until after you’ve signed a lease.

3. They Ask You to Pay for a Credit Score Check on a Referral Website

Another common type of scam is related to credit reports. Specifically, some scammers ask their unknowing victims to obtain a credit report through a link they send you in an email. The link then redirects the renter to a screening company, where the renter is supposed to pay for their evaluation via credit card. Consequently, the scammers get a commission through the referral campaign, although they clearly have no intention of renting to you — if the rental you’re applying for even exists.

4. There’s No Screening Process

As a renter, you should be prepared to undergo a screening process involving your credit, as well as a background check. If there is no such process for the property you want to rent, that should raise a lot of questions. Landlords are very diligent about vetting prospective tenants, and you want a landlord who is concerned and experienced. Conversely, a landlord who skips the rental application and credit check is not going to have either of those traits.

5. The Listing is Shady

If the listing itself has typos, excessive punctuation or grammatical errors, that might also be a sign that it’s fraudulent. Professional property managers or serious landlords will have an accurate, quality description. So, if the listing is poorly written, chances are that you’re dealing with a scammer. Be especially careful about the supposed deal if it’s paired with a price that is much lower than the average rent for a similar unit.

How to Avoid Rental Scams

• Always Use Apartment Search Websites with Trustworthy Listings

Not all apartment websites are created equal, so be sure to use one where scammers are not able to post listings. To ease your mind, it’s best to use a website like rentcafe.com, where listings come directly from property managers. Also, the apartments and single-family rentals listed on rentcafe.com are provided by property management companies, not posted by individual owners.

Property management companies’ websites are also a trusted place to browse for apartments. Many property managers publish detailed information on rental listings on their own websites. If you want to check on a specific apartment building, a good place to research, verify and get additional information is the property website itself.

• Reverse Google Search

Scammers may also hijack ads from trusted websites and post them on less-secure websites. If you come across a listing with a low price or one that seems too good to be true, you can do a reverse Google image search of the property to see if it appears on multiple websites under different names or displaying different information.

If after a reverse Google search you find that the rent price listed on the property manager’s website is different than in the ad you found, you should report the suspicious ad to the local authorities. Furthermore, property managers’ websites will often have a resource page for renters, including practical advice on how to avoid rental scams.

• Meet the Landlord & See the Apartment

The best way to prevent yourself from falling for a scam is to meet the landlord and see the apartment, even virtually, before you sign the lease. Be prepared to ask questions related to the rental and the community — such as details about payments, maintenance requests and refund policies — and assess the answers you get.

During the pandemic, solutions have been found to minimize social exposure but still be able to visit an apartment in person, such as self-guided tours. This is an important last step before signing any contract or making any sort of payment. It’s important to confirm that everything is transparent so you know what you’re paying for.

• Get Everything in Writing

Before you send any money, review the terms of the rental, including the price of rent, all fees and maintenance. Ask for a copy of the contract for yourself, as well, but sign it after making sure the apartment is managed by a reputable company

How to Report a Rental Scam

If you come across a rental scam or fall victim to one, contact local law enforcement. And, because scams take place on the internet, you can also send a report to the Internet Crime Complaint Center (IC3), as well. The IC3 works with the FBI to take down any scheme that occurs on the internet, including rental scams.

Be aware that scammers are out there and be skeptical when you spot a deal that seems too good to be true. Do your research and don’t give in to the excitement of the moment — most scammers will also pressure you into thinking that you’re losing the deal. Instead, remain calm and be patient. If you see any of the red flags listed here, cut all connections and don’t be afraid to report the listing to prevent others from falling for rental scams.

Expert Advice on Rental Scams

Lawyers and realtors also have advice for dealing with scammers and how to report rental scams. In particular, they say to never confront a scammer directly. Rather, these experts recommend educating yourself on how to spot rental scams and know how to safely report them. We thank them for their collaboration; click on their names below to see their full answers.