If you’re considering renting a home while you restore your credit rating, consider this: the home you rent may be a foreclosed property, and the person you are paying first and last month’s rent plus security deposit is part of a real estate scam.
This very sophisticated—and sometimes, very expensive—scam has become so prevalent that the Department of Real Estate (DRE) has now posted a consumer alert about bogus rental properties on its web site: www.dre.ca.gov/cons_alerts.html.
This is a very slick operation, starting with ads listed in the classifieds or Craigslist that attract people looking for a rental home. Drawn in by the location or price of the property, potential renters make contact with “rental agents” who make appointments to meet at the properties, tour them through the homes, provide business card for contact information and present contracts or rental agreements. In some cases, not only does the fraudulent leasing company take the renter’s deposits, but it collects monthly rents—until the real property owner or its agent visits the home to prepare it for appraisal and sale.
The Department of Real estate offers this advice: carefully review the proof of ownership paperwork, ask for photo ID and then go to the DRE website to see if the person representing himself or herself as an agent of the owner is licensed. The DRE has a detailed consumer alert on its site, and a listing of phone numbers for consumers all over the state.