Sunday, April 19, 2015

Craig’s list rental scam

I mentioned in a recent post that my daughter is graduating and (even better) has a job lined up in Rutland, Vermont.  With graduation just around the corner she needed to secure housing to begin her career and it was during this housing hunt that we stumbled on an example of a rental scam that, unfortunately, arises on Craig’s list.  My wife and daughter spotted a small house being advertised for rent.  The background story was that the alleged owner had tried to sell it but ran out of time and was transferred to California.  The advertised price was very attractive – not a “give away,” but lower than market.  This was somewhat explained by the alleged owner who related that they wanted to find the “right person” – at times referring to wanting a “god fearing person” and a “clean freak” who would take care of their property.  The alleged owner followed up with a number of pictures and a simple rental application which was a series of questions.

Perhaps sad to some, but whenever I hear someone throw around “god fearing” or “honest” or words of that nature alarm bells go off for me.  Generally, I find these individuals to be anything but honest or god fearing; they are quite simply scam artists who seek to engage your trust so they can rip you off.  In writing this post, I attempted to retrieve the exact verbiage used by the alleged property owner and found the key words “god fearing” in a different message string where Craig’s list buyer wanted me to mail my item to them.  Another alarm bell rang when my wife related that the alleged owner told my daughter that the house didn't sell because the Realtor listed it too high and if you should see the listing on the internet it is because it hasn't been taken down yet.  I sold and invested in real estate for a few years and I have never heard of a Realtor being unwilling to lower a listing price to get a house sold – it is always the owner who digs in for their price and it is generally the Realtor who tries to reason with them to get them in the market range to get the house sold.   Remember Realtors only get paid if they sell the house so they are not motivated to overprice a home.

Aside from my concern that this was an outright scam, a secondary consideration is whether this would be a good situation even if everything the alleged owner said was true.  For starters, what about repairs and maintenance?  If the alleged owner is in California, who was going to take care of the property if a problem arises?  A secondary concern is the character of the landlord.  In this case, the alleged landlord used the term “god fearing” – even assuming that the offering is legitimate, would this landlord be one that is controlling and judgmental?  Would they object to overnight guests or social use of alcohol?  If they want a “neat freak” would this mean that you couldn't make the space feel like it is yours?  (Curiously, although they characterized themself as a "neat freak, they were receptive to a pet).  Would you have to preserve it to the original tastes of the owner?  When you consider these details, this deal didn't feel as compelling even removing the concern that it may be an outright fraud.

Midway through this process it occurred to me that the most obvious way to get clarity would be to look up the listing on the internet and call the listing agent.  I made the phone call and left a message detailing my interest.  In my experience as an agent, I have found that almost all agents would speak to anyone regarding something related to their listing.  Even if it had expired, I suspect that the agent may remark something to the effect “yes, I had the listing but the seller was challenging to work with” (or they may come right out and refer to the seller as “difficult” or other if it fell through).  Prior to getting a call back from the listing agent, my daughter made the decision to not pursue this rental.  Several days later, I received a call from the realtor which confirmed my suspicion that this was a scam.

In a nutshell this is how the scam works:  The scam artist trolls the internet and copies photos of real estate for sale.  They then craft a “For Rent” ad on Craig’s list with a back story that they had to leave the area before they could sell (for whatever excuse – job, family emergency – complete with “sad” bogus story, etc.).  Next they attempt to engage potential tenants into a trusting relationship based on a “virtual” handshake.  The end goal of these scam artists may be either to get you to send them a deposit (they’ll be very flexible and take just about any amount) and/or get you to complete their rental application which may include personal information such as your date of birth and social security number (which can be used for identify theft).

To counter these scams, it is important to follow Craig’s list recommendations which include dealing locally.  Never send money and do not provide personal information until you meet the individual and have physically visited the property.  As with any business transaction, always be ready, willing and able to walk away from a deal.  Even if the deal turns out to be legit, it can be a miserable year if you get stuck in a lease with landlord that has a disagreeable personality.