Tips to avoid becoming a victim of rent fraud
A blog post today for all tenants and would-be tenants. If you don’t rent through a bona fide agent, you best be prepared to be scammed and lose a lot of money. Rental fraud is a growing problem, with fake landlords taking the deposit and rent upfront and then disappearing.
In this article, you’ll learn how to spot a fake rental advert and how to avoid being scammed.
How the rent scam works
It’s hard finding a place to rent. There are too many would-be tenants chasing too few properties in the private rented sector. And when you do find that perfect home, the chances are it may already have been let to a tenant 10 minutes earlier.
Given these problems, it’s tempting to secure the property as quickly as possible by paying a deposit or upfront rental – perhaps both.
The fear of missing out is the key that scammers are using to unlock would-be tenants’ bank accounts. It’s a simple fraud to execute, too. All it takes is an online advert and a phone. Here’s how it works:
- Property is listed online, with a convincing advert that usually includes photos and contact information.
- When a would-be tenant makes contact – often online, but perhaps to a mobile phone number – the fake landlord provides more details of the property. It sounds even better than it looks in the advert.
- The landlord says that there are viewings taking place and that they expect the property to be rented within 24 hours, probably by the end of the day.
- To secure the property, all you need to do is pay the deposit, a month’s rent up front, or a holding fee.
- You make the payment, and this is the last you hear from the fake landlord.
- Your money is gone, you have no home to move into, and you are now further away from moving into a new home.
How much do rent scammers cost would-be tenants?
In 2018, Action Fraud – the UK’s anti-fraud force – reported that more than £22 million had been stolen from would-be tenants in this way. The average cost is £1,396 per would-be tenant. Hundreds of victims of this fraud have lost more than £5,000.
In addition, there is the emotional cost: the turmoil a victim is put through, the sleepless nights worrying about how to replace the money that may have been loaned to them.
Who is most at risk?
Fake landlords aren’t fussy who they steal from. Their view is that if a would-be tenant is a fool enough to fall for the scam, then they are fair game. If you have money in your bank account and are desperate to find a home to rent (you may have missed out on a couple of properties recently), you are a target.
There are some would-be tenants who are easier to scam than others. These include university students and would-be tenants who live overseas. Both are less likely to wish to view the property advertised and are keen to secure somewhere to live – it’s another task ticked off their list.
How can you avoid being conned by a fake landlord?
Fortunately, there are several things you can and should do to ensure you don’t get scammed in the rental market.
1. Don’t rely on the landlord’s word
Some fake landlords have used false letterheads and logos to make it look as if they are legitimate. These include using branding from industry bodies such as ARLA and the NLA.
2. Do view the property if possible
We understand that it may not be possible for you to view the property, particularly if you currently reside abroad or will be moving hundreds of miles across the country to relocate. However, if you can view the property, then you should do so.
3. Don’t send money up front before ensuring the landlord is genuine
However desperate you are to secure the property, don’t send money up front without checking and double-checking that the landlord is genuine. If the advertiser claims to be a letting agent, check them out online. Visit their website, call them on the number advertised on the website, and carry out a search on the Companies House website.
4. Do be careful how you pay a deposit
If you are happy that your efforts have confirmed the landlord to be genuine and wish to pay a deposit to secure your new home, take care of how you send the money. It is much safer to use a credit card to make a payment online. Far less safe is to use a money transfer service – the scammer can use the details to withdraw more money from your account.
5. Don’t get fooled by a great offer
If a deal looks too good to be true, it usually is.
6. Do check the landlord
One simple way to check that the landlord is genuine is to contact the organisation that they claim to be a member of. Ask for a membership number, contact the landlord organisation they say has accredited them and request confirmation.
7. Do pay a deposit into a tenancy deposit scheme
By law, landlords and letting agents must hold tenancy deposits in a regulated tenancy deposit scheme. Make sure it is.
8. Don’t pay a deposit without doing this
Finally, never pay a deposit or send any money to a landlord without seeing the paperwork that will help to prove the property is genuine. Ask for a copy of the tenancy agreement, safety certificates, and any other paperwork that would help to prove that the landlord is the owner of the property.
The easiest way to avoid being scammed is…
To rent through Ezytrac! We manage more than 1,200 rental properties for genuine landlords. We do all the checks so that would-be tenants have the easiest and safest route to finding their new home.
Whether you are a would-be tenant or a buy-to-let landlord, get in touch with Ezytrac today: at +44 0 1522 503 717 the best way to let and rent.
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