How NOT to rent a home

Let’s say you’ve just got an excess of money in your life, and you’re tired of it. To remedy the situation, you decide to lose eleven or twelve hundred dollars to a con artist.

Now, how should you go about it? Eureka! To Craigslist!

Start looking up rental properties on Craigslist and find a few you like. Start contacting property owners until one instructs you to drive by the house and check it out. The owner himself can’t be there to show you around the place because he’s on vacation overseas. However, if you like the look of the place, you can just send a check for the first month’s rent to his vacation address (or wire the money).

Follow his instructions to the letter, and hey presto! you’ve just lost several hundred bucks! The person on the phone never did own the house, and in fact has just lifted photos from a legitimate rental advertisement.

Naturally, nobody actually wants to lose money to a scam, so what I’m really saying here is don’t do any of the above.

Okay, fine, you can look for apartments or houses to rent on Craigslist. That, in and of itself, isn’t a mistake. However, if you find one you’re interested in, absolutely refuse to hand over money unless the property owner agrees to meet you there in person, has a key that opens the door, shows you the inside, and can prove that the property belongs to him or her. (You still might want to bring a friend with you, because there are other, non-financial risks associated with meeting a stranger.)

Also, never hand over money until contracts have been signed and everything is official and legal.

With the kind of scam described above, you have to consider three questions: first, why would you agree to rent a house or apartment, mostly sight-unseen (except for the outside)? What if you find out there’s no kitchen and the only toilet is right in the middle of the bedroom?

Second, why would they agree to rent a house to you, sight-unseen? There are people in the world who just wreck stuff. Any owner renting out a property is going to want to feel you out in person and make sure you at least don’t seem like the type that’s going to cut a hole in the living room wall with a chainsaw three days after you move in.

Third, if the house is locked up and the owner is supposedly on vacation overseas, how’s he s’posed to give you the key?

Land Sale Scams

Back in the ’60s and ’70s, land sale scams proliferated, and a lot of people ended up buying useless parcels of swampland in Florida. You’ll still come across an occasional reference to someone buying swampland in sitcoms and movies, especially as a way to establish that an older character is gullible or tends to fall for get-rich-quick schemes. It has become such a part of the collective subconscious that it’s turned into a joke.

However, today these scams have seen a resurgence, with online marketplaces such as eBay being the new venue of choice for con artists. In the United States, Florida, Texas and Arizona are the most frequent sites chosen for such scams, but they can happen in other places.

The Attorney General of Florida has published some tips for avoiding this type of fraud, and these apply pretty much anywhere:

  1. View the property. Do not buy land over the phone or by way of the mail. Talk to residents who live in the area.
  2. Look into the amount of all fees, such as real estate taxes, or community assessment fees.
  3. Meet with real estate agents in the area to find out the market for this property. Ask the agent how long it would take to sell the property if need be.
  4. Check with the county planning office to learn of plans for the land or property near this area that may affect land value. It would be important to know if an airport or dump is scheduled to be built in the future.
  5. If the land is undeveloped, know who will be responsible for the costs of building roads, utilities or sewers.

I couldn’t have said it better myself. Sing us off, George…

[youtube=http://www.youtube.com/watch?v=YiddXGbRn5g]

Avoiding real estate and rental scams.

Rental and real estate scams seem to be on the increase lately. Maybe they’re just getting more attention, but if they’re anything like every other scam in the universe, they proliferate in a rough economy.

There are versions that target both owners and renters.

For example, if you’ve got a property to rent out, you might be contacted by a party who claims to be interested. They will either send you a cashier’s check (first and last month’s rent, deposit, etc.) for far over the amount you’ve asked, then ask you to wire the remaining funds back to them, or give you a check then pretend to back out of the agreement later.

In this case, remember first that anyone who gives you a check then tells you to wire some or all of it back to them is attempting to commit fraud. I have yet to come across an exception to this rule. Also, if you’re renting out a property, only deal with people you can meet in person, verify their identification, and do all the credit and other checks you’d ordinarily do.

If you’re attempting to rent a property, the scam usually involves people who claim to be landlords but aren’t. You have to verify that a property is in fact owned by the person you’re talking to. Just having the key doesn’t mean anything—sometimes this scheme is run by former tenants. Ask to see the landlord’s ID, and use local websites or other resources to verify that you’re dealing with the real owner.

As a final tip, just be beyond cautious if you’re using Craigslist for renting out a property or finding a place to rent.

The IC3 has some additional information, and this site goes into even greater detail. Whichever side of a rental situation you’re standing on, it pays to stay vigilant.