You are looking at Craigslist apartment or even house rental listings for a new place to live. You know that scams are common on the site, but it can’t really happen to you, right? WRONG, according to NYU researchers. Craigslist fails to identify more than half of rental scam listings, and suspicious posts linger for as long as 20 hours before being taken down.
Is there anything you can do to make your chances of being a scam victim drop dramatically? Here with the answers is real estate expert John Adams:
Q: John, how often is this happening?
Adams: It happens a lot, especially in Atlanta.
Researchers reviewed more than 2 million for-rent posts and found 29,000 fake listings in 20 major cities. Atlanta is a prime target because we have such a vibrant rental market and we are actually growing our population again after the recession.
Q: So, how do these scams work?
A: In the NYU report, there were three key types of scams.
1. In the first, a fake post instructs a would-be tenant to purchase a credit report. The scammer gets a commission from the credit reporting site, even though there is no property for rent.
2. In another scheme, con artists duplicate rental listings from other sites and post on Craigslist at a lower price. Prospective renters pay a deposit via wire transfer.
3. Another pervasive scam is so-called "realtor service" companies. Targets are asked to pay fees to access listings of private pre-foreclosure rentals or rent-to-own properties. In the majority of cases, these fake companies leading the scams have no connection to the properties listed.
In every case, once the money is sent, it cannot be recovered and the scammer disappears like a puff of smoke. It’s literally GONE WITH THE WIND!
Q: John is there a way we can Spot a Rental Scam before we get burned:
A: Absolutely! I have found five ways you can protect yourself if you are looking for a rental online:
1. Don't wire money or use a prepaid debit card: You should never pay a security deposit or first month's rent by prepaid debit card or wire transfer. These payments are the same as sending cash - once you send it, you have no way to get it back.
2. Watch out for deals that sound too good: Scammers lure in targets by promising low rents, great amenities and other perks. If the price seems much better than offered elsewhere, it may be a scam.
3. See the property AND THE LANDLORD in person: Don't send money to someone you've never met for an apartment you haven't seen. If you can't visit an apartment or house yourself, ask someone you trust to go and meet the agent or landlord. Take lots of pictures - scammer HATE cameras.
4. BEWARE of the OVERSEAS LANDLORD story: Scammers often claim to be out of the country and instruct targets to send money overseas. NEVER send money overseas unless you are using a major credit card with charge back provisions.
5. Search for the same ad in other cities: Search for the listing online. If you find the same ad listed in other cities, that's a huge red flag.
The scammer is relying on the fact that you have no idea what he looks like. He will NEVER agree to meet you in person ANYWHERE. There will ALWAYS be a GOOD reason why he can’t be there. Never pay money to someone you have not SEEN.
THE BOTTOM LINE: Finding a new rental home on CRAIGSLIST is a wonderful thing, but know that these scammers are counting on YOU to trust THEM with your MONEY. Make them PROVE to you they are LEGIT before you let MONEY cross the table!