As counsel to a national residential property management company, I have noticed a trend on the rise here in Maryland: people residing in a property illegally (squatters) but with a sincerely held belief that they have a valid lease. Often times these people have paid several thousands of dollars, only to later discover – when the actual landlord for the property issues a notice to vacate and/or files a wrongful detainer case – that the lease was and is fraudulent. In other words, that they were the target of a residential real property scam. Below are some tips on how to avoid being scammed when searching for a residential rental property and signing a lease.
Tip #1: Check out the Owner on SDAT
Maryland keeps records of the owner of record for every single property, and those records are publicly available and easily accessible to anyone who has Internet access. So, before you sign a lease to rent a property, run a real property search on the Maryland Department of Assessments and Taxation (SDAT) website (https://sdat.dat.maryland.gov/RealProperty/Pages/default.aspx) to find out who is listed as the property’s owner of record. If that person or company’s name is not on the lease that was presented to you for signature, then it’s likely that you’re being scammed.
Tip #2: No Up-Front Lump-Sum Rent Payments
I recently had a case where the squatter had paid the fake landlord over $10,000 up front to cover a year’s worth of rent. This is a huge red flag. If a landlord or management company asks you to pay more than 1 month’s of rent (and a reasonable security deposit) up front, then it’s likely that you’re being scammed.
Similarly, if a landlord or management company asks you to pay via Western Union (or other money transfer company), cryptocurrency, or any other form of untraceable payment, it’s likely that you’re being scammed.
I’ve had multiple victims tell me that even though it “seemed too good to be true,” they paid thousands of dollars up front for what ended up being a fraudulent lease. So trust your Spidey Sense. If it seems too good to be true, it probably is too good to be true.
Tip #3: Check out the Landlord/Management Company on SDAT
Obviously, you should never rent without meeting the landlord or rental agent. But beyond that, you should never rent a residential property without checking out the landlord/management company.
Maryland also keeps records of every company that has registered to do business in the State, and once again, those records are publicly available and easily accessible to anyone who has Internet access. Before you sign a lease, and even before you start dealing with a potential landlord or management company, run a business search on the SDAT website (https://egov.maryland.gov/BusinessExpress/EntitySearch). That will help you determine whether the company that claims to be the landlord or property manager is a valid business in this State. If the company does not exist in the SDAT database, then it’s likely that you’re being scammed. If the company is listed in the SDAT database, however, then pay close attention to the principal business address. Does it match the business address that you have been given? This is all part of doing your due diligence on the landlord and/or the property management company.
Tip #4: Pay Attention to the Email Address
Most, though certainly not all, valid businesses do not use webmail email domains (for example, @gmail.com, @yahoo.com, @ymail.com). Instead, the email domain will be some iteration of the company’s name. If you are communicating with a potential landlord via email and they are messaging you from a webmail domain, it is possible that you’re being scammed. There is an exception here, of course, for individual landlords who only own a few properties in their own names rather than through a company name. However, any reputable property management company will email you from a business email domain as opposed to a webmail email domain.
I Was Scammed. Now What Do I Do?
If you’ve discovered that you might have been scammed – whether you received a notice to vacate or were served with a lawsuit – reaching out to the landlord who defrauded you will offer little help. Usually you’ll find that the fake landlord has shut down the email address, disconnected the phone, and is not actually in existence at the office address that they gave you. Instead, contact the person or company who issued the notice to vacate or the attorney who represents the real landlord in the lawsuit. While they won’t be able to help you get your money back, they may, and often will, work with you to either (1) give you time to find another place and move out or (2) keep you in the property under a valid lease. I also recommend that you notify the FTC, local law enforcement, and Maryland Attorney General’s Office as soon as possible. The more information you can provide them, the more likely they are to be able to catch the person who defrauded you.