How to avoid rental scams

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Newcomers can be easy targets for scammers. They can take advantage of your lack of knowledge about the rental market and rental laws, as well as your urgent need to find a place to stay. There are basically two scams to watch out for:

Fake online ads

The easiest way to look for available places to rent is on the internet. Unfortunately, it’s also the most common venue for scams. One of these are fake rental ads that you may find on websites like Craigslist, Kijiji or Facebook. In this type of scheme, the perpetrator uses the photo and some information from a legitimate ad (like a house for sale or for rent, for example) and changes the contact details so that interested parties will contact the scammer. They will use email and instant messaging as their mode of communication. They will convince you to send a month’s rent and a security deposit through e-transfer like Western Union or MoneyGram. Once the money is sent, the scammer disappears and cannot be traced.

Red flags:

  • The rental price is low. They offer half or less than half of the prevailing market rate. The might say that they are giving you a “discount” because they want good tenants who will take care of the property.
  • The scammer will always be in a rush. They will push you to decide and send the money right away. They will say that many people are interested in seeing or renting the property.
  • More money to seal the deal. They may ask for additional funds, like for a security deposit or additional month’s rent before they send the keys.
  • No tour. They will have excuses not to meet you in person or talk on the phone. They may send you photos instead of a tour. There are audacious scammers who will show you the house and give you a copy of the keys. You will later realize that the keys do not work.
  • They will be abroad. The usual reason for renting out the house, apartment or condo unit is that their work contract has ended and they must to go back to their country. Another common reason is that they are going away to another country to work (usually missionary work). This will require the renter to send money abroad, making it harder to trace the scammer.
  • There is no lease contract.
  • E-transfer. The preferred method of payment is bank wire, money transfer, and other electronic means. They will not accept cheques as this can leave a paper trail.

Advance payment

Part of the process of applying to rent a house or an apartment is a credit check. Since newcomers to Canada have no credit or rental history yet, the landlord may ask for a co-signer or guarantor. Getting one can also be difficult for newcomers. Some unscrupulous landlords take advantage of this situation by requiring advance payments costing from six months to a year’s rent. Thinking that this is a common practice, some newcomers agree to this arrangement. Under the Residential Tenancies Act, landlords cannot ask for advance payment as a requirement for the rental agreement.

How to avoid these scams:

  1. Trust your instincts. If it seems too good to be true, especially if the cost of rent does not match the property, then it must be a scam.
  2. Don’t give out personal or financial information (they can use these to steal from you).
  3. Don’t give money right away. Most scammers will rush you to pay. They can’t give you time to do research and think things through. If you are already in Manitoba, ask to see the place. If they say they can’t show you the place, that’s a big red flag. Never send money to someone you’ve never met.
  4. Make sure the property exists (and that it is available for rent). If you are a pre-arrival, get the help of a third party like a relative or friend living in Manitoba. Ask them to go and see the place themselves. Check if it is a legitimate rental. If you’ve just arrived, ask the help of a settlement service provider. If you are in Winnipeg, contact New Journey Housing.
  5. Make a paper trail. These are documentation like a lease agreement and receipts for anything you’ve paid for. Most scammers will not be able to provide these. The reason why scammers ask for payment through e-transfers and remittance centers is that transactions are hard to trace.
  6. Check with the building manager. Condominiums and apartment buildings are usually handled by a property management company. Look them up on the internet, search on BBB, or ask for a contact to inquire from in the company. A little bit of research can save you from losing thousands of dollars.
  7. Know market rental rates. Check sites like Winnipeg Rental Network, RentBoard.ca or Rentseeker.ca.
  8. Know your rights as a tenant. Attend New Journey Housing’s workshops if you are already in Manitoba.

If you’ve been offered a deal that you think is a scam, get the help of the Winnipeg Police or report it to the Canadian Anti-Fraud Centre. The information you provide may help authorities catch these criminals and help others from getting scammed.

 
Sources: Rental scam, Canadian Anti-Fraud Centre; Online rental ad too good to be true, scammer almost ensnares Winnipeg house hunter, CBC News; and Fake rentals are a real problem, Ryan Thorpe, Winnipeg Free Press. Accessed November 29, 2018.

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