Whether you’re traveling or looking for a place to live, you might want to double check before you pay rent.
A new warning from the Better Business Bureau suggests that if a space seems like a dream come true, it might actually be a nightmare.
According to a study from the BBB, “fraud is widespread in the online rental home and vacation rental market, with 43% of online shoppers encountering a fake listing and more than 5 million consumers losing money to such scams.”
The study found the rental scams can take several forms, but one seen most often is one in which fraudsters “simply copy the photo and description of a property, post it online with their own contact information.
"While an advertised rental that meets your needs at a great price might be tempting, it just may be a scam,” Steve Bernas, president and CEO of BBB of Chicago and Northern Illinois, said in a statement. "Consumers shouldn't rush into paying upfront fees for renting housing sight-unseen. Instead, take time to verify the details of listings."
According to the BBB’s scam tracker, there have been more than 1,300 reports of rental fraud from 2016 to 2019 while the FBI’s Internet Crime Complaint Center reports more than $37 million in losses associated with complaints mentioning the word “rent” from Jan. 1, 2019 to now.
It’s a problem NBC 5 Investigates first reported on two years ago, when music student Ben Longson was scammed by what he thought was the perfect apartment in Wrigleyville. Turns out that while Longson and more than 168,000 others who applied for the listing thought they were applying for a free credit score, they actually signed up for a $25 a month credit monitoring fee.
The FTC ultimately shut down the company behind the listing.
How can you avoid such scams?
The BBB says to watch for these red flags:
-Watch for listings that say the owner is out of town and the unit can’t be seen
-Beware of unconventional payment methods for deposits like gift cards or money transfers
-Often, the rent will be below-market rate and the property will require you to leave the online platform where you found the listing to complete the transaction
-Check the address and make sure it is valid
What can property owners do to ensure their properties aren’t being used in a scam?
• Rental unit owners should watermark photos used for rental postings, which will make it more difficult for scammers to copy photos of other properties posted online.
• Website platforms that list houses, apartments and vacation properties should make extra effort to screen for bogus listings, and they should explore ways to allow consumers to easily report scam listings.