Rental Scam Alert
Better Business Burea Scam Alert: Planning to move this spring? If you are hunting for an apartment on Craigslist, watch out for rental cons. A new report from New York University explores just how common these scams are.
Spoiler alert: they are everywhere.
How the Scam Works:
You are looking at Craigslist apartment listings for a new place to live. You know that scams are common on the site, but just how prevalent are they? Very, according to the 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.
Researchers reviewed more than 2 million for-rent posts and found 29,000 fake listings in 20 major cities. Of those, there were three key types of scams. 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.
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. Another pervasive scam is "realtor service" companies. Targets are asked to pay fees to access listings of pre-foreclosure rentals or rent-to-own properties. In the majority of cases, the companies leading the scams have no connection to the properties listed.
How to Spot a Rental Scam:
• 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.
• 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.
• See the property 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 confirm that it is what was advertised.
• Don't fall for the overseas landlord story: Scammers often claim to be out of the country and instruct targets to send money overseas.
• 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.
Read the full report from New York University's Tandon School of Engineering on rental scams on Craigslist. The report is the first systematic study of online rental scams.
To find out more about other scams, check out BBB Scam Stopper (bbb.org/scam). To report a scam, go to BBB Scam Tracker (bbb.org/scamtracker).