How To Protect Yourself From Rental Scams
Rodolfo Delgado is the Co-Founder & CEO of Replay Listings, the first platform to find apartments for rent in NYC focused on unedited videos.
Searching for a rental apartment online is as exhausting as it is complicated. Pictures lure potential renters with promises of spacious interiors, while in reality, the bathroom and the kitchen are so close to each other it’d be easy to confuse the toilet for a seat at the table.
Listings can be misleading in multiple ways. Having worked previously as a real estate agent, clients who were moving to New York for the first time would often share stories with me about a fantastic and incredibly affordable rental apartment they saw online. When I asked why they hadn’t rented it, they would often say, “The broker told me it rented recently, but they insisted on showing me other options.” I’ve heard that story many times — you probably have too — that’s often referred to as bait-and-switch.
It took me years to gain enough industry insight into how listings can be misleading or renters scammed. This very knowledge empowered me to become the CEO of a New York-based listings platform focused entirely on unedited videos. There is a surprising amount of unreliable data online. Unwitting apartment hunters often fail to question the information’s legitimacy simply because it’s published on a big company’s website. So how can you tell the difference between a fake listing and an authentic one?
Take a close look at the floor.
I recommend asking your trusted agent for a video tour, as I’ve always believed them to be more reliable. If you only have access to pictures, take a closer look at the floor. Floors throughout apartments usually have the same finishes and patterns, so if you notice multiple tints or designs, that may be a red flag on the listing’s authenticity.
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Know who the agent is representing.
Ask the agent/broker if they are representing the landlord or the tenant (you). An agent who represents the landlord will generally seek a higher price or a longer commitment for the benefit of their client — the landlord. An agent representing the tenant should be actively working on getting the tenant the best possible offer.
In some states like New York, real estate agents are obligated by law to offer every client they interact with a DOS form, which discloses the relationship between the tenant and the agent. The agent should hand you a DOS form during your first interaction. If the agent doesn’t offer it first, ask for it, as it’s designed to protect you. If you interact with 10 different agents, you should end up having 10 DOS forms.
Never pay cash.
If an agent suggests cash deposits upfront, that’s an immediate red flag. Reliable companies will always ask clients to write a check made payable to the company, not the agent. Doing so helps prevent fraud and protects the client. Remember to ask for a confirmation receipt when you hand the check to your broker. The ticket should include the terms of the deposit (for example, check is nonrefundable unless not approved by the landlord).
Look for testimonials.
Experienced agents know that building trust with their potential clients is crucial. Ask agents for testimonials given by their past clients and focus on their reaction — if they get offended by something as simple as this, you probably shouldn’t work with them. In my experience, every veteran agent has reviews and testimonials ready to share with their potential clients.
If it seems too good to be true, it probably is.
The fact that the listing appears on a big company’s website should not lead you to assume that the data provided is right or even real. Enhanced pictures used as bait to attract more clients are a common practice in the real estate community. It’s that deceptive technique called bait-and-switch, which happens when you call an agent on a listing that appears to be a bargain. They tell you the unit was just rented and offer a similar — and often more expensive — property nearby.
The best way to combat the bait-and-switch is by being informed about the current market conditions. Reading online market reports is a great starting point and will help you spot discrepancies between a listing and its price.
Every real estate agent should immediately bring down any listing that is no longer available but remains visible to the public; otherwise, it’s a misrepresentation and may lead to losing their real estate license.
Real estate agents should use technology to understand their clients’ needs and propose solutions that work best for them. Ask for unedited videos, floor plans, testimonials and any data that is difficult to enhance. It may feel like a tedious task, but it will only serve to safeguard you from being one of the 5.2 million Americans who have lost money to rental scams. Improve your chances of finding the perfect home by being smart and doing your due diligence.
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