As the recent data breach with Target serves to underscore, you can never be too careful when it comes to your financial information. While you cannot eschew technology altogether, it is important to become educated about scams and various types of Internet fraud.
One of the most common scams that I've heard about from tenants involves a landlord asking prospective tenants to wire them the deposit because they are located in another state or even out of the country. This can often be quite tempting when the rental property in question seems to have everything a tenant desires. In a desperate attempt to rent it before someone snatches it out from under them, the tenant will usually comply. Unfortunately, the entire thing is a scam and the tenant will lose his or her money.
Far too frequently, renters fall victim to scams when responding online to advertisements for properties that do not even exist. For instance, a scammer might pretend to be a tenant who is placing an ad to sublet an apartment for a great price. He or she will incorporate a sense of urgency in the ad by stating that they need someone to take over the lease immediately. The prospective tenant is asked to wire funds to cover the deposit and first month's rent. As you might guess, once the renter sends the money, they discover that there was no rental.
In a twist to this scam, a con artist might actually rent a property from a landlord and then advertise the unit online for subletting. After he or she has received funds from several renters for security deposits and the first month's rent, they leave with the money and never pay the landlord. In this scam, both the landlord and the renters responding to the ad become victims.
Many times, the price of a rental can serve as a red flag. More often than not, if an advertised rental appears to be too good to be true, that's likely the case.
Prospective tenants can avoid potential scams and fraud by observing the following tips:
- Always ask landlords to verify their identity
- Research the property address, name of the landlord, and phone number online
- If the property is being managed by a management company, contact them to find out whether the person you are speaking with actually owns the property in question
- Exercise caution if the landlord states he or she will only accept cash for a deposit
- If the property in question is a sublet, take the extra step of contacting the actual property manager or landlord to ensure that the property does exist and is available for sublet.
As a landlord, I believe one of our fundamental responsibilities in today's Internet-savvy world is to provide tenants with the best service possible combined with reliable protection for their personal and financial information. The VerticalRent Trusted Landlord Seal program offers an effective method for combatting Internet fraud by ensuring that rental ads posted on online sites are completely legitimate.
Matt Angerer is the CEO and Co-Founder of VerticalRent. A veteran landlord and real estate investor, Angerer brings a unique angle to the business of owning rental units. Once a cubicle jockey in the corporate rat race, Matt desired a more fulfilling approach to building assets and financial security. Witnessing his father (John) create a small nest egg of rental properties, Mr. Angerer realized the power of wealth building assets. Inspired by what the "Average Joe" could accomplish, Matt set out to create an easy-to-use rental property management software for the 40 million landlords across America that own between 1 and 50 rental units.
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