(MoneyWatch) Mortgage scams are everywhere. And it’s not only vulnerable homeowners that fraudsters have preyed upon since the housing collapse — they’re also targeting renters.”Rental scams have increased dramatically in the past four years since the economic downturn,” says Michael Schaffer of Checkyourlandlord.com, a service that provides background checks on landlords and properties. “Unfortunately, it is the type of thing that goes unreported a lot.”
Unlike with mortgage fraud, the FBI doesn’t have much information on how prevalent rental scams are. But the anecdotal evidence suggests that they are common, with many people reaching out for help to experts like Schaffer and Dan Daugherty, founder of CEO Rentbits.com and the brains behind Rentalscams.org, a website that educates people on scams.
“In the summertime, too, we see a dramatic increase in rental scams,” Daugherty says. “A lot of people are moving. College students are looking for places in college, many are little more naive, so we see a lot [of it] happening now.”
And with many former homeowners opting to rent following the housing bust, the rental market also has become more competitive. That mean there’s more money to be made off desperate renters. Here are three of the most common rent scams:
Too good to be true
The scam: You see a great apartment at a great price — a really great price. You email the person on the listing, who happens to be a missionary working in Africa (or some other far-flung place). They ask for a deposit via wire transfer and promise to send the keys. But the keys never come.
This is a variation on the Nigerian wire scam. The scammer has copied a listing, only they’ve lowered the price and made up some excuse about why they are never in town. The ploy is obvious enough that few people fall for it. But in Nigeria, where most people live on around $3,500 a year, they only need one person to fall for it, Daughtery says.
The easiest way to avoid this scam is simple: Don’t send someone money for a place you’ve never seen. Make sure you sign the lease with the landlord or a representative in person.