Here at Renttoday.us, we’ve been doing the property management thing for some time and have seen our share of rental scams come down the pike. We thought it would be a great use of our blog to share some of the more interesting scams with you.
The Con: The Pigeon Drop Victim: Property Owner
How it goes down
A scammer looks through the internet or newspaper looking for houses for rent, especially for rent by owner ads, since it’s easier to con an individual as opposed to a professional company. And, they know they can prey on their vulnerabilities and financial distress.
The owner is contacted and the scammer advises the owner they are extremely interested in leasing the home and will take it sight unseen, immediately! Oh, and of course they will pay all cash upfront! A property owners dream, right? No need to check credit on someone paying cash and man, this property has been vacant for a month now and you need the cash!
THE CATCH
Of course, the tenant is a medical student from overseas and their only way to pay is via a lump sum money order that will need to first be deposited in the owners account. The amount exceeds what they need to lease the property so the owner will owe the tenant the difference. Just need to deposit the money order and send the remaining back to the tenant. Of course, they need the difference right away since that is what they will be using to travel to their new home. It makes perfect sense!
Now, there is a couple variations on this game and it can go a few different ways
- The owner will either deposit the money order into their account, then send a wire or money order for the remaining funds back to the scammer. The scammer’s money order will bounce of course but they already have the owners’ money which was the difference between the rental amount and the amount of the fake money order. The scammers are set until the next scam and the owners are left out in the cold with no real tenant, a fake money order, and they just got ripped off for whatever the difference was by someone overseas who they probably will never find.
- Sometimes, instead of sending the owner a physical money order, the scammer will offer to wire the money directly in the owners account (which sounds great, right?). Except that they don’t really wire any money and after you give them your banking info, routing number, etc. you find out your account has been wiped out clean, you have no real tenant, and you are much worse off than you were before!
Either way this goes down, the owner ends up losing money and wasting time!
How to avoid the Scams
As you can expect, we think you should LET THE PROFESSIONALS HANDLE IT! An experienced property manager will see this con coming two blocks away and there will be no chance of a scammer pulling this one over on us!
One, we’ve been managing rental properties in Southern California for a long time and have heard and seen it all before.
- We are trained to identify “red flags” like this
- We don’t make emotional decisions and we can look at things objectively.
- We do our due diligence on each and every tenant and won’t cut corners for some fast cash
- We don’t ever give out our bank account information or accept direct deposits from tenants
Scam Indicators
Here are some things you can watch for to help you avoid getting scammed!
- Prospective tenant is from out of the country
- Willing to lease your house sight unseen
- Wants to send you more money than what is owed
- Asks for personal or bank account information for depositing purposes
- In a hurry, needs everything done as quickly as possible
When it comes to cons, it’s all fair game! Whether you are an owner desperate to lease your rental home or a unsuspecting tenant just trying to find a place to live, there is a scam tailor made for your specific need.
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One Response to “Scam of the Day”
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May 1st, 2010 at 4:51 am
Great post thx a lot !