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Online Rental Scams: 5 Tips, 5 Red Flags

Renters beware: Online rental scams may be moving to a city near you. What are some keys to avoid becoming a victim?

In one recent case, an Arizona resident fell victim to a classic online housing scam on the popular housing website Zillow. The victim found a house for rent on Zillow and inquired about it. The scammer told the victim he would hold the house for $800, and the victim sent the money. But after the scammer asked for more money, the victim grew suspicious and called police, Tucson's KOLD-TV reports.

Lest you fall prey to an online housing scam, follow these five safety tips:

  1. Deal locally with people you can meet in person. According to Craigslist's housing scam tips, "follow this one rule and avoid 99 percent of scam attempts."
  2. Don't rent or purchase housing sight-unseen. Unfortunately, pictures can be misleading. In this case, photos of a legitimate listing in the "sale" section were taken and relisted by the scammer in the "rentals" section. Nothing can trump going to the property in-person and speaking to the owner.
  3. Never wire funds. Especially for rental properties, beware requests for substantial deposits before seeing the place.
  4. Don't submit to credit or background checks remotely. Wait until you have met the landlord or agent in person before giving up your personal information.
  5. Find out who owns the property. Always carefully inspect the property deed.

And the No. 1 rule: Never give money up-front without meeting in-person first and inspecting the property.

Alas, the victim in the Arizona case committed a cardinal safety sin by paying before seeing the property and never meeting the "property manager" face-to-face.

Rental Housing Scam Red Flags

Although housing scams on Zillow and other websites are becoming a serious problem, there are almost always telltale signs of a scam.

Beware the following rental housing scam red flags:

  • Using Zillow for money exchanges -- according to Zillow, it does not handle money exchanges or escrow between buyers and sellers or tenants and landlords.
  • Photos in the listing show up in other sections of the website (such as the "sale" section or in different regions).
  • When you show interest, the scammer claims to be out of town and asks you to wire first-month’s rent or other fees to an out-of-state location.
  • A requirement to pay by Western Union, MoneyGram, cashier's check, or money order.
  • An inability or refusal to meet face-to-face before consummating the transaction.

If you've fallen victim to a housing scam, you may want to consult an experienced consumer protection attorney to figure out what legal options you have.

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