Freddie Mac, the big mortgage company, is renewing a warning of a scam that began appearing at the beginning of the housing bust.
Scammers are illegally renting out foreclosed and for sale homes to vulnerable renters. They have absolutely no legal right to these homes but will appear as if they do. They can then make off with money or even a renter’s personal information such as bank accounts and social security numbers.
These scammers can advertise on rental sites or, more often, places like Craigslist, or simply on bulletin boards in coffee shops or grocery stores. The rental ads promote properties that appear very attractive, often below market price, and seemingly easy to obtain. The criminals may ask for first and last months’ rent, security or pet deposits, most always in cash or money order, hand over a set of keys and vanish.
Fraudulent “landlords” may even replace locks on vacant homes in order to show prospective tenants around with no one the wiser. Even a For Sale sign can be explained away as a previous attempt to sell that just didn’t work out.
After showing the property the scammer may produce paperwork and ask for social security numbers, bank account info, and other personal information as part of the application process. They may ask for an application fee as well and then vanish with both.
Stories are surfacing of tenants even moving into properties only to be evicted by the actual owners, real estate agents or bank representatives. Unfortunately some of these victims have given most of their money to the scammers and have little left to find another place to live.
Sometimes the tenants don’t even get the keys; they fill out a fake lease application, disclose sensitive personal information such as Social Security and financial data, send the money and never hear a thing again.
Robert Hagberg, Freddie Mac’s associate director of fraud investigations, said in an interview that foreclosure rental scams are becoming a significant problem, in part because of the sheer number of foreclosed properties on the market for sale.
- To avoid becoming a victim of rental fraud always do your homework on any prospective rental property. Run a check on Google or other search engine for the address to see if it’s actually for sale.
- Check out the landlord or property management company online. If you don’t find them that could be a sign of a scam.
- Never fill out an online application until the property is verified as legitimate. Turning over personal information without knowing for sure is asking for trouble.
- If you have to rent a property from another city find a respectable property management company through a real estate company, bank, or if you’re transferring for a new job, ask the Human Resources manager at your new employer.
Finding a suitable rental property is hard enough without being taken to the cleaners. You can count on National Property Management Group Miami to find the best property for your needs. Our success is based on great relationships with our property owners and a commitment to our renters. Contact us and see the difference that can make on your rental experience.