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Scams that Target Renters: Avoid these Rental Scams

rental scams


Rental scams have been around for decades, and sadly, they don’t appear to be going anywhere. Here are some of the most common scams that target renters.

Landlord Foreclosure Scams

If an owner has failed to make his payments, is served with a foreclosure notice and has vacated the property, he is expected to surrender the right to rent the property out. But out of desperation or spite, some resort to scamming unsuspecting renters instead. The landlord foreclosure scam involves renting the home out, pocketing the deposit and first month’s rent, and skipping town before anyone notices.

This leaves the bank to deal with the new renter, who is often asked to leave because there is no lease that the lender will honor. It doesn’t matter where the bank is located; they will find out that the tenant is not the owner when the sheriff knocks on the door, thinking he is going to evict the owner. He will contact the bank, and because there is no lease and their client is gone, they will evict whoever is living on the property.

Fake Landlord Scams

This rental scam long pre-dates the housing crisis. It involves con-artists assuming “ownership” of seemingly abandoned or vacant homes, advertising them for rent and collecting rent from the new tenants for as long as they can. Many times, homes that are owned by out-of-state landlords are the most vulnerable properties for this kind of activity. In other cases, as has been a major problem for Craigslist, is that scam artists will copy the pictures posted in a legitimate rental ad, and re-post the same home for rent at a much lower price.  Usually the scam involves the “owner” claiming to be “out of the country” and in order to see the home, the unsuspecting renter is told to wire money overseas and keys will be delivered by “a friend” upon receipt of the fund.  In one case, I had recently rented a home to a legitimate renter, but the scam-artist posted the home for rent anyways after the fact.  As the new tenant was watching TV in the living room one day, they noticed people looking through the window.  When they confronted the person outside, they were informed that the person had sent $800 to a person in a foreign country and was supposed to get keys from the person “babysitting” the home.  Obviously the person living in the home was not “babysitting” it, and the person outside was quite displeased to learn that she had been ripped off.  As with any online advertisement, always be cautious of anyone requesting that you send money overseas.  It’s almost always a scam.  In the event that someone does take occupancy of a home in an illegitimate fashion, they can be forcibly removed by the sheriff, or evicted in court if they refuse to leave, regardless if they knew about the scam or not.  When it comes to rental properties, always remember the phrase “buyer beware”.  Use your good judgment and diligence before giving away your money, and always realize that if the deal is “too good to be true”, it probably is.

The Slumlord Scam

This one is also as old as time. When a property is flagged for building code violations, including those pertaining to the safety of tenants, the tenants usually have no way of knowing about it ahead of time.  One tenant I worked with rented a home that had a big work shed in the back that had been converted into a living space, complete with bathroom, kitchenette, living area, and sleeping area.  The primary tenant lived in the main house and her Aunt lived in the converted work shed.  Somehow a city code inspector noticed someone was living in the workshed and issued a citation.  Apparently the work shed had not been permitted for occupancy, and not only did the Aunt have to move out, the entire living quarters inside the work shed had to be demolished and removed.  Needless to say, it didn’t go over with either the tenant or the Aunt, but all of it could have been prevented if the owner had disclosed that the converted living area had not been permitted.  In other cases, owners may not know about code violations unless the property is randomly targeted for inspection.  Often they learn about the violations from the city or county officials who come to inspect the property. They may end up being fined, or forced into making expensive repairs.  To make matters worse, once a property is cited, Code Inspectors usually don’t give a whole lot of time to get things fixed.  In some cases, they may require modifications to be completed in a matter of days.  If repairs are not made within the appropriate time frame, expensive daily fines can be imposed.  Problems like these are not limited to one type of property or another, they can happen anywhere.

The best way to avoid any of these rental scams is to rent your home through a reputable property management company.  If you find a home for rent on Craigslist or any other uncertain website, it’s always a good idea to check with local property management companies to see if the home is really for rent or not.  Many reputable property management companies only work with landlords who have been verified for authenticity. Contact your local trusted Property Management Company for more information.