September 03, 2015

Fraudsters Casting Wider Net on Internet

Online Rental Fraud

Share this with someone you know looking for a place to rent.  Fraudsters are using pictures of anything that looks like a house to trick would-be renters out of their money and enough personal information to potentially steal their identities.

The phony ads promise an irresistible rental in exchange for a deposit and first month's rent sent via electronic transfer.  The fraudsters don't own the house. Until recently, fraudsters primarily used pictures from legitimate on-line ads for foreclosed homes to create their phony offers. (This is why HomeSteps, Freddie Mac's Real Estate Owned (REO) sales division, posts "not for rent" signs on the homes it sells.*)

But this is changing. According to news reports fraudsters are casting a wider net, creating rental ads with photos of privately owned homes or anything else that looks like a house.  One fraudster advertised Babylon, NY's village museum and cultural center as a home rental, according to a recent article in Newsday.

Want to avoid this rental scam?

First, make it a point to personally tour the interior of the property and verify that the person you are working with is authorized to rent it before sending in a security deposit or rent check.

Next, watch out for these red flags:

  • Requests that you wire funds, provide your credit card number, or use purchase money cards to pay for the security deposit and initial month's rent.
  • Advertisers who will only communicate by text message or claims to be out of the country;
  • Requests for personal information, including credit card or Social Security numbers, before you can verify the property is for rent and that you are working with the owner or a bona fide rental agent.

For more information on avoiding real estate scams visit My Home by Freddie MacSM.

* If you see an ad or a sign offering a HomeSteps property for rent, call 1-800-4FRAUD8

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