The internet makes everything we real estate investors do so much easier. Unfortunately, the internet also makes it easier for real estate scams. One such scam was recently tried with one of my properties. To understand what happened and see the scam for yourself, keep reading.
It Began With The Ad For Our Property
We, like most other investors now days, advertise our properties on various websites like Craigslist, Backpage, Zillow or Realtor.com. Hardly anyone drives around and looks for signs or reads ads in the newspaper anymore. Instead, everyone wanting to rent or buy is looking online.
We recently rehabbed a home for the retail market which was being advertised for sale on many of the websites mentioned above. Our ad had a full description of the property, along with plenty of pictures and our contact info.
The Scam
Here is what the scammer did. He or she copied our pictures and created a new ad. This new ad offered the property for rent (not for sale) at a price way below the market. This low price surely had the scammer’s phone buzzing. Once the scammer was in contact with a potential victim, they offered a long explanation of who they (the supposed owners) were and why they were renting the property.
Take a look for yourself:
It continues:
The scammer wove a pretty good story right?
Thing is, it is all likely false. Except for the address and property details, as far as I know, the rest is all made up. The hook is the low rent and security deposit required. It is about half of what the actual charges would be. The scammer hopes your greed will get the better of you and that you will send them the money (Before it is too late!).
Red Flags Everywhere
The story above is however full of red flags. There are several things that should make anyone cautious and think twice. Here is what caught my eye:
- The Long Backstory
Why does this person have to go into so much detail about why they are renting the house? Who cares? I just want a house to rent I do not need to know your life history.
The backstory however is designed to reel you in, to make you feel comfortable and to build TRUST. You can trust me because I’m a missionary. You can trust me because I’m doing good in the world. You can trust me because I’m married. You can trust me because I’m a family man. You can trust me because I have a 27 year old daughter named Leslie who is smart, which makes me older and wise.
Do not trust anyone or anything in any ad on the internet without verifying it first.
- The Appeal For Help
The scammer sets up the scenario well. They will be away. They will be away from their family. They will be away doing good deeds. But they have a problem, a problem YOU can help with. You are a good person right? You are clean and neat right? You are the perfect solution to their problem. You can help them. You may even want to help them.
This is all a play on your emotions. Don’t fall for it.
- The Language
The whole ad when taken together just sounds off. This is because the scammer is likely a non US English speaker. They may have even used Google translate to create the ad. There are words and phrases that we just do not normally use here in the United States such as “medical practitioner” or “too much of an agent fee.” Being a non US English speaker is not necessarily a bad thing. But, a lot of these scammers are not in the US and thus do not have our language down pat.
Use caution if an ad does not sound quite right.
- The Mean Realtor
The implication in the scammer’s narrative is that the realtor is greedy and trying to hurt good people who just want a nice house to rent. They are trying to get you to believe that they hate the realtor and you should too. They say this so you will just ignore those realtor signs in the yard and not call those numbers on the sign. The scammer wants you to think they are going to take care of that greedy realtor and that you will get a better deal by not having to pay her.
Wrong.
Again this is an appeal to your emotions and an attempt not to get you to call the number on the sign in the yard. Because if you do, the scam is finished.
- The Price
The price of the rent is just too good to be true. As I said it is about half of the going market rent. That is the hook to get you in. Remember, if it sounds too good to be true, it probably is.
Did The Scam Work?
No, the prospective tenant was smart enough to pick up on a number of these red flags. She actually did call the number on the sign and talked to my wife who told her what was really going on. We got the ad removed quickly and that was that, at least this time. But this person was wise and tried to verify. Many others would have fallen for this story or the scammers would not do it. They would have been blinded by the “good deal.” They would also be $1,450 poorer.
How Can Investors Fight These Scams?
The best way we have found is to watermark all of your pictures that you use to place in ads on the internet. Watermark them with your company name and phone number. This small task will stop most scammers in their tracks because what they say in their scam will not add up to what is seen on the picture. Some sites however may not let you use watermarked pictures, so these efforts could be limited.
Another thing investors can do is “Google search” their properties every once in a while to see what comes up. Search by address. These scam ads may appear and you can then take action.
Finally, take your ads down as soon as you can. If your property has sold or been rented, no need to keep the ad up. Don’t give the scammers ammunition.
I have heard stories about those that fall for this scam showing up with a moving van to an already occupied property. Don’t be one of those folks. If you feel that something is wrong or off, then it likely is. Dig deeper before giving your money away.
