You’ve probably heard of prospective renters losing out on thousands when rent scammers pose as the owners of a rental property. Those hopeful tenants find out too late that the property they paid for never existed.
But potential tenants aren’t the only victims of rent scams. Occasionally renters try to scam the owners by using the property they’re renting to gain a profit. They pose as the owner of your rental property and rent it to someone else.
Most of the time, the renter will ask for a deposit and first month’s rent payment without ever showing the tenant the property. They’ll list a fake address and the potential tenants will be out of luck when they’re ready to move in.
Some scams are even worse than that, however. Particularly sneaky scammers will get the keys from you via the mail, show the property to others, and let those people pay them the deposits and advance rent.
The unlucky persons who rent the property from the fake owners may live there for a while, and pay rent and security deposits to the imposter. You send email reminders for rent payments to the scammer, who ignores them, and by the time you figure out what’s going on, the fake owner has disappeared with the profit you never saw.
Don’t let this happen to you. You’ll want to know what to look for among your potential tenants to avoid such scams.
If you’ve posted an ad for your rental property online, you’ll likely get a response in the form of an email. When a potential renter responds and expresses interest in your property, carefully study the post for signs of fraud.
Most potential scammers will post emails with frequent misspellings and poor sentence structure, and assert things that are too good to be true.
Besides analyzing the content, also take a good look at the address the message came from. Most scammers will use a free email address service such as Yahoo, Gmail, Hotmail, and Rocketmail.
If there’s a silly name or a lot of numbers in the address, that can be the sign of a fake email. On the other hand, please note that millions of people use free email services, so this should not be taken as definitive proof that the email is from a scammer. Rather, regard it as a signal that further verification may be needed.
3. Compare the occupation
Most scammers will tell you their occupation in an attempt to make them seem more realistic. Owners tend to love doctors and ministers as tenants, so scammers will often tell you that’s their occupation.
Compare their stated occupation to the email message. Is the email written in a professional manner? If not, the person is most likely lying about his profession. Ministers and physicians tend to be highly educated and well read.
Also, compare the profession to the type of rental you’re offering. For example, if your property is several thousand a month for a two-bedroom flat and is located nowhere near a church, your tenant is probably not a priest or reverend.
4. Tenants send money without viewing the property
Anytime a tenant offers to send money without viewing the property or at least asking various questions about it, you should be wary of his intentions. Scammers will often pay with a cashier’s check or money order, neither of which qualifies as a personal check.
These payment forms require several days for banks to authenticate. Scammers will overpay with their initial payment, and then tell you they’ve made a mistake with the check.
You’ll be informed the money is safely in the bank, so you should wire them the excess money and by the time you find out the original check was a fake, it’ll be too late.
5. Visit online ads frequently
Scammers will often take the approach of stealing your online ad and marketing a copy of it to others. If you regularly check online ads such as those on Craigslist, you’re more likely to run across duplicate listings, and you can contact the authorities before anyone loses money.
6. Interview your tenants
The importance of interviewing your tenants before any money is exchanged cannot be stressed enough. Perhaps the most effective way to stop a rental scam in its tracks is to get to know the tenants thoroughly before they move in.
Begin with a detailed rental application in which you request personal information that you can check, including name, occupation, monthly income, etc. Then run a credit check to make sure the applicants will be reliable rent payers.
If they have poor or no credit, move on to the next applicant. Ask for references, and contact each one with questions to help you ascertain the credibility of the potential renter.
Finally, ask for a personal interview. Don’t do it over email. In person is best, but if that’s not possible, do it over the phone or Skype. It’s more difficult for scammers to fake a personal interview, and most won’t waste their time trying to, in any case.
7. Visit the property often, if possible
Some owners live too far away from their rental properties to make regular site visits, but it’s a good way to prevent scams. Every few weeks for the first couple of months of a new renter’s contract, visit or send a trusted associate to see the property.
If your renter has signed the contract but no one has moved in yet, find out why. Also, plan a surprise visit to introduce yourself to the people currently living in your rental. Introduce yourself and check to make sure the residents have the same name as the original applicant.
8. Hire a property management company
All of this can be quite a hassle for owners who have busy lives and other responsibilities to attend to. The best possible way to avoid getting scammed is to engage a property management company to take care of the entire process.
A good one can handle the listings, tenant screenings, background checks, rent collection, maintenance, and much more for a flat fee each month. If you want to ensure that you’re dealing honestly, a good rental property manager can make sure that happens.
If your rental property is in the Houston area, give us a call today, and we’ll help you secure your property from the nastiest of scams.