Imagine finding an affordable rental property near your daughter’s established family home. You go back and forth with the realtor from the listing for weeks. You fill out the online application and you are approved. Before buying moving boxes, you log in to your bank account to see if your security deposit has cleared your checking. Your heart nearly stops when you see a screen that reads $0.00.

Based on the Federal Bureau of Investigation’s 2021 Internet Crime Report, rental scams are on the rise. In the mere 11,578 reports made to the Internet Crime Complaint Center last year in regards to real estate or rental scams, over $350 million was disclosed as victim loss, 64% more than the year prior.

Citation: https://www.ic3.gov/Media/PDF/AnnualReport/2021_IC3Report.pdf

 

The older we become, our desire to be close to family grows. Some seniors may choose to purchase a home nearer to their children or siblings. Others may choose to rent an apartment with great amenities and specials for those fifty or older. There is also the ever popular increase in family vacations that encourage seniors to invest in timeshare or vacation rentals. With the wish to be near our families, it is important for elders to be aware of potential rental scams. Scammers intentionally lure elderly renters with the goal of exploiting them for financial gain. Daniel Klibanoff and Elder Protective Services examines three popular rental scams, the warning signs, and how to protect yourself or your loved ones from being a victim of financial fraud.

Ghost Rentals

Don’t be spooked by the name. A ghost rental is NOT a haunted home listed as a vacation destination, but rather a non-existent property being advertised as an affordable investment to exploit elders who simply want to move closer to their families.

For a phantom property, a scammer will create a fake advertisement and promote it as real. These listings typically showcase a lower rent than other homes nearby or include promising amenities, like a “brand new washer and dryer set”.

What to Look For

  • A rental or vacation property may be too good to be true a Rental Scam, if you see:
  • No Pictures: Scammers will argue that they do not post pictures in order to ward off potential robbers or vandals. The truth is that there are no pictures because the listing is fake.
  • Low Price per month: Based on the advertisement, the rent is extremely low. Scammers use this tactic to exploit potential renters into paying a fee for an application. Even if the potential renter receives a “You’re Approved” email, the fact is that the application was fake because the listing is not real.
  • No Address: Fraudsters will claim that they do not want to disclose the address in order to protect the current tenants. Be wary of ANY rental property that does not include an address.
  • Luxury Amenities: Such amenities lure in potential renters as it makes the home desirable. Victims will complete the costly application without speaking to the realtor in hopes of beating out the competition. For scammers, this ploy is easy, passive income.
  • No Phone Number: Use caution when reviewing a rental listing that only provides an email contact or states “Email thisaddress@email in order to receive a discount on your application!” By doing so, a potential renter could open their email up to phishing and other scams.

Protect Yourself

  • Do not trust a listing or advertisement that is missing key information like pictures, an address, or methods to contact the realtor or landlord.
  • Check out other real estate websites. If the same property or advertisement is listed in another city, it is likely a scam.
  • Do not complete a costly application WITHOUT verifying the property is real.
  • NEVER pay a security deposit, fee, or first month’s rent before you have signed a lease and received that lease in writing or electronically.
  • If you are unable to see the property, for whatever reason, DO NOT sign an agreement.
  • NEVER provide personal, sensitive, or financial information, like a Social Security number or Bank Routing number, to a property owner without verifying their identity.

Lifted Listings

A lifted listing is similar to a ghost rental in the sense that a lifted listing is fake. But rather than using free-stock images or a made-up address, lifted listings simply duplicate a pre-existing rental. A lifted listing is essentially a hijacked advertisement. Scammers will pick a listing with reliable photos, luxury amenities, and error-free description to copy and then severely lower the price. These stolen ads may even proclaim “All Credit Accepted” or comparable phrases.

The goal of such a scam is to lure potential renters into completing an application and paying a fee. In the application, victims are encouraged to provide personal information, like phone numbers and emails, and sensitive information like Social Security numbers. Scammers will use this information for financial exploitation and identity theft. Avoid lifted listing scams by knowing the warning signs and putting protective measures in place.

What to Look For

  • Low Price per month/Luxury Amenities: This tactic builds interest and creates a competitive market. Potential renters fill out the application with verifying the renter is legitimate in order to get a leg up on the competition. Unfortunately, scammers will collect personal and financial information for identity theft or to sell to other criminals.
  • Pressure to Act Quickly: The “renter” or “landlord” will attempt to use scare tactics by creating a sense of urgency to make victims complete an application or send payment immediately.
  • Duplicate Listings: Similar photos or the same address on a listing in another city or state prove that the lifted listing has been hijacked.
  • Request to Wire Money: Upon receiving a “You’ve Been Approved” email, scammers may follow up with a request for the first month’s rent payment or money wire for a security deposit.

Protect Yourself

  • Reverse Image Search. If the same property or advertisement is listed in another city or state, it is likely a scam.
  • The FTC suggests doing “a search on the owner, real estate management company, and listing. If you find the same ad listed under a different name, that’s a clue it may be a scam.”
  • DO NOT give into high-pressure sales or signing tactics.
  • If you are unable to see the property, for whatever reason, DO NOT sign an agreement.
  • DO NOT pay a security deposit, fee, or first month’s rent before you have signed a lease and received that lease in writing or electronically.
  • NEVER provide personal, sensitive, or financial information, like a Social Security number or Bank Routing number, to a property owner without verifying their identity.

Illegal Subletting

The process of subletting is nothing new. A sublet or sublease is a contract that allows a tenant to rent out their property to another individual while their name is still on the lease. Despite the fact that most tenants need permission to sublease, scammers still take advantage of the situation and prey on elderly renters. This scam is not as obvious because fraudsters have access to the property and can easily provide victims with a tour.

What to Look For

  • Signing with a Tenant: If you are NOT signing a lease with the property manager or company, use caution before completing the paperwork.
  • Damages: When subleasing, often previous damage done by the original tenant becomes the subletter’s financial responsibility. A ruined stovetop could cost a subletter their security deposit and more. ALWAYS read the fine print.
  • Specials: Scammers may rope potential renters into subletting a rental property by offering a price lower than the current rate, though this price may be more than the original tenant’s agreement, thus they are making a financial gain.

Protect Yourself

  • ALWAYS get the terms of your rental in writing, including fees, rent, and maintenance.
  • Verify the tenant is legally allowed to sublet.
  • Check to make sure the apartment is managed by a reliable company.
  • NEVER pay a security deposit, fee, or first month’s rent before you have signed a lease and received that lease in writing or electronically.
  • NEVER provide personal, sensitive, or financial information, like a Social Security number or Bank Routing number, to a subletter without verifying their identity.
  • AARP’s General Red Flags of Rental Scams

The American Association of Retired Persons, AARP, created a list of red flags that all senior citizens should be aware of when beginning the rental process, whether they are looking for a long-term or vacation property.

  1. A monthly rental payment below the market rate.
  2. A listing with grammar or punctuation mistakes.
  3. A landlord with a “dramatic” story.
  4. A refusal to speak or video chat, communicating only by text or email.
  5. A request to wire money, send it via Western Union or MoneyGram or pay with gift cards or bitcoin.
  6. A check for the wrong amount.
  7. Do not accept overpayment from a would-be tenant for a property you list. If you get such a check, return it. Do not deposit it.
  8. A sense of urgency.
  9. A claim of affiliation with Apartments.com…
  10. A hard sell.

Citation: https://www.aarp.org/money/scams-fraud/info-2020/apartment-rental-ads.html?intcmp=AE-FRDSC-MOR-R2-POS3

 

Rental Scam Plausible Exploitations

If involved in a rental scam, victims will likely be financially exploited in one or more of the following ways.

Application Fees

As previously explored, some rental scammers seek financial gain by simply encouraging victims to pay for applications on non-existent or duplicated property listings. They coerce potential renters to pay a fee by arguing that “there is no point in touring a property that you may be unapproved for”. If a victim is fortunate, they will wire a scammer money and never hear from them again. If unlucky, the victim may be strung along and pushed to make more payments in order to secure the rental property, which will never actually happen because the property does not exist.

Send Money for the Keys

After a successful application process, a scammer may claim that they are currently out of town on a family matter. These fraudsters will ask their “client” to wire money in order to receive the keys from a disclosed source. Some victims claim they were actually sent keys, but they were not the correct keys for the property.

Identity Theft

The most severe possibility of a rental scam is identity theft. In this case, a scammer will require a potential renter to perform and provide them with a credit check in order to tour the property. By providing the report, the victim will unknowingly hand over their personal and financial information. The scammer will use the provided information for identity theft. Remember; NEVER provide personal, sensitive, or financial information, like a Social Security number or Bank Routing number, to a property owner or renter without verifying their identity. If you believe you gave your personal information to a scammer, go to IdentityTheft.gov for steps you can take to protect your identity.

Key Takeaways:

As seniors search out rental properties in order to move closer to home and family, scammers will prey on their desires and create a false sense of urgency for financial exploitation. The best way to protect yourself or your loved ones from rental scams is to be wary of the warning signs and put protective measures in place. If any part of a vacation property or rental listing looks shady, do not engage with the lister. Take advantage of technology to reverse image search or research for duplicate property listings. Whether you are looking at a property that seems too good to be true or feeling pressured into completing an application remember:

  • Do not trust a listing or advertisement that is missing key information.
  • Check out other real estate websites for duplicate listings.
  • Do not complete a costly application WITHOUT verifying the property is real.
  • If you are unable to see the property, for whatever reason, DO NOT sign an agreement.
  • Do not pay a security deposit, fee, or first month’s rent before you have signed a lease and received that lease in writing or electronically.
  • NEVER provide personal, sensitive, or financial information, like a Social Security number or Bank Routing number, to a property owner without verifying their identity.

Steps to Report Rental Scams

  • Contact your local authorities: Each state handles real estate fraud differently and provides various support resources for renters.
  • If you found the listing on a rental website, contact the website directly to take down the advertisement and prevent other potential renters from becoming victims.
  • Report it to the Federal Trade Commission. The FTC is responsible for protecting consumers and their personal information.
  • File a complaint with the IC3. The IC3 is the Internet Crime Complaint Center, a government agency that makes it easy for individuals to report a crime that takes place online. They work with the FBI and local authorities to help manage and solve internet scams, such as rental listing scams.
  • If you believe you gave your personal information to a scammer, go to IdentityTheft.gov for steps you can take to protect your identity.
  • Daniel Klibanoff, an advocate for seniors, is currently serving as the President and CEO of Multimedia Lists, Inc. Daniel is also the founder and director of Elder Protective Services, an enterprise aimed to serve and protect elders. Learn more at Elder Protective Services.
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