It all starts innocently enough… we spend hours online looking for the home which is the best fit for our family, in the best school districts and more.
It can be difficult to determine whether an opportunity is legitimate or not, so start by doing your homework and be cautious before committing to anything.
Many of us have no idea how many scammers are lying in wait; real estate scams are a common reality in today’s rental market and just like the old saying, “if it seems too good to be true, it probably is!”
It Almost Happened To Me
We received Recruiting Duty orders to Texas and found out just how easy it was to fall into a rental scam. I discovered the perfect house for our family and even better, it fell within our basic allowance for housing (BAH).
I emailed the contact on the listing and asked for more information about the property, being careful not to disclose anything about our family or myself to them. He responded with a long story about how God has chosen us to live in his house while he was away. He also explained that he had already moved to Georgia to take care of a family member and didn’t want to sell his house because he would eventually be moving back.
He went on and on about how we were such a great family, but I had never mentioned anything about having a family which immediately put me on guard. He wanted to cut us a deal because we were so great, here’s how it worked: if we paid six months’ rent in cash, he would lower the rate a couple hundred dollars a month. I immediately knew something was up! When I emailed back asking if we could wait and see the house when we got in town next week he never responded.
When we ended up arriving to our new city, we drove past the address of that rental, just to check it out. Not only did we find that it wasn’t for rent or sale, there was a family already living there. After our experience I will always work with a reputable real estate agent.
It may not always be so obvious that you’re being scammed. Oftentimes scammers are posting ads with homes that are for sale or homes that have been abandoned in bank foreclosures that don’t belong to them.
Homes on the Market
The home you’re looking at may very well be on the market for sale or rent, but the person you’re dealing may not be the authorized contact. Everything online looks legit. You’re interested and have had good communication.
The next step is typically filling out an application and sending in a deposit to secure the home, right? But now if you give them the application, you’ve just given all your personal information away which can be used to create credit cards, loans and more. If they take your deposit, you can be out several thousand dollars of cash.
Here are some instant red flags while browsing online rentals:
- They ask for money via Western Union, money orders, wire transfer, or to mail cash.
- They ask you to wire them the money to a bank in a different city or state than where the property is located.
- The ad uses poor grammar or has misspelled words.
- They are unable to show you the house because they are out of town, already moved, sick, etc.
- They email you from a free internet provider such as yahoo, hotmail, gmail.
- They don’t require you to fill out any paperwork and are willing to rent you the house almost immediately.
- They mention religion.
- They say once they receive your money they will send you the key.
- They won’t provide a phone number to reach them at.
- If the price seems too good to be true.
How to Verify a Private Home Owner
- Discover which county the property sits in and look up the owner. Google: [insert count] property records office.
- Ask for a Skype or Google Hangout session to see the house in real time. If they don’t agree or have a valid excuse, it may be a scam.
- If they say they’re active duty military, ask them to email you from an official military email address.
How to Verify a Leasing Agent
- Ask if there’s an MLS listing number and have another agent verify the home is on the market for what you’re looking at (price, rent, sale, etc).
- Have the agent verify that authorized contact on the MLS.
- If you’re dealing with a property management company, verify their information. Make sure their address and information listed matches up, or its regional chapter matches what the agent gave to you.
- Check and see if the state the home is in requires leasing agents to be licensed. Google: [insert state] Department of Real Estate.
- Meet at their office listed on their records if possible.
- If you have a friend in the area, have them go by the property or meet the agent for a walk-through.
Finally Make Sure You
- Google the address of the listing and look to see if there are similar listings with different prices. If the price is lower somewhere, it’s probably a scam.
- Google: [insert count] property records office. Sometimes even this isn’t enough if the property is in the beginning stages of foreclosure; oftentimes it can take up to 90 days to get the information publicly released.
- Ask questions about the area, who they’d use for repair services, how and where rent is paid, how often the locks are changed, etc.
- Avoid using wire transfers or cash. It’s much easier to track a payment made with your credit card or personal checks.
- Never give any payments before you see documents or fill out an application. Most places are going to require some sort of check on you as the tenant.
- Check other listings in that area. If houses in an area rent around $1500/a month and you find one for $700/a month. Be careful before committing to anything.
If you have any red flags or something doesn’t feel right, don’t do it. Remember to always ask friends if they know anyone moving out of the area who are currently renting or join groups to discover if they are happy in their rental and when it would be available. Happy home searching!