Your search for a dream apartment can become the worst nightmare of your life if you get caught by real estate scams. Scammers are there in every industry and the way they tangle you is hard to avoid. Rental fraud is when a landlord or agent pretends to sell a property that does not exist. These fake owners collect processing fees, security deposits, and application fees before you identify them as scammers.
Unfortunately, despite the strict real estate laws, the number of fake real estate agents is mushrooming and you need to be extra careful while making the most substantial financial transaction of your life.
There are some warning signs which can help you identify property scammers:
If you are aware of rental fraud types, chances are you are going to avoid false listings. Here are the most common rental scam types:
A property is advertised at a lower mortgage rate and the scammer collects deposit fees before you come to know the higher rate of the property.
In the NYC rental market, a renter is lured by a lower-priced apartment that does not exist in real (the bait). With such a lucrative offer, many renters contact the landlord to get an awesome deal. But then you hear that the apartment is not available. However, the agent then says he/she has other apartments to show you for a higher price (the switch).
Before you contact a landlord/agent, make sure:
If you check all these boxes, chances are you will get a verified rental. Last but not the least, never go for a property which is out of your budget or you feel uncomfortable with.
Already Leased: As the name suggests, a scammer collects a deposit fee for a property that is already leased.
Hijacked Ads: A scam artist advertised a real property with fake contact information.
Phantom Rentals: A real or fake landlord lists the properties which do not exist or aren’t rentals.
If the listing looks genuine to you, there is still a chance of fraud and you would never want to lose your life saving to a scammer. Take the following steps to be on the safer side:
Things you need to know
1. An experienced and authentic real estate agent generally sells a minimum of one property per year.
2. With the name and address of an agent, you can Google the PR of the broker.
3. Don’t go blind on online reputation as many scammers use marketing tips to establish a good reputation on Google.
4. If an agent says that his/her commissions are non-negotiable, step away from that agent.
5. Before you chose an agent, ask for his/her license.
6. Look for the track record of the agent. Don’t rely on the testimonials placed on their blogs, instead ask for the phone number of previous clients and have their feedback about the agent.
7. Fake agents will never answer your questions enthusiastically and will focus on their personal achievements.
8. Without talking about the property, they will keep asking for money.
An ultimate real estate agent is responsible to bring sellers and buyers to a table where they can negotiate the terms and in return, both parties pay the agent his/her commission. In the modern era, many people are tagging themselves as experienced real estate agents without knowing the ABC of the market. And a few turn into scammers and use a short-cut way to become a millionaire.
Before you shake hands with an agent, keep in mind the tips mentioned above and you will be on the right track right till the end.