When it comes time to think about your next move, there's so much to consider, from how to find the perfect sofa to how to deck out your new space for remote work. While the design and decorating piece of it is exciting, there's another important component to make sure you don't let slip by the wayside: keeping your money safe and secure. You might be thinking, "Don't you just sign some paperwork, schedule your moving truck, and send some money?" But that last piece is key — especially these days, as digital scams and fraud are on the rise.
Scams directed at home owners and hopeful renters are nothing to scoff at. According to Apartment List, 5.2 million U.S. renters lost money from rental fraud in 2018. The Consumer Financial Protection Bureau also reports that the Federal Bureau of Investigation has seen phishing scams increase by a whopping 1,100% from 2015 to 2017. These frauds use emails, texts, or other digital communications to try and get you to send money to a fake account.
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And one thing is key to remember: There's normally nothing you can do to stop a wire once the receiving party has accepted your funds.
Don't worry, we're not here to scare you. Instead, we spoke to experts about how you can avoid being scammed via wire transfer when all you're trying to do is finally lock down that Instagrammable apartment or home you've got your heart set on.
1. Don't send money before you see a property in person.
"The biggest mistake is wiring funds before accessing the [place] in person," realtor Daniela Pereyra told Hunker. "Scammers will tell you that they will mail you the key(s) once they receive your funds and will even send you a photo of a fake envelope where they're supposedly mailing you the key. A scammer will go as far as sending photos of the 'rental' [or home] but really it's a home for sale with publicized photos. Always look up the address."
In the end, it's all too easy for a landlord or subletter to request that you wire over funds, and then ghost you. Then you're out your money, and that living space you were already decorating in your mind.
2. Find support — it will make a big difference.
Don't be afraid to ask questions or seek out assistance in the rental or home buying process to avoid being scammed or stressed.
"The best way to protect yourself from scams as a home buyer is to work with a buyer's agent. Real estate agents have knowledge of and access to property records as well as legal documents used throughout the transaction," Pereyra advises. "A scammer may pretend to be the home owner but the home's records, which your agent can access for you, specify the owner's name. A buyer's agent makes their commission by receiving a split from the listing agent's commission, which is typically paid by the seller. Sometimes even a for sale by owner deal will offer a buyer's agent commission for bringing the buyer to the table and handling the transaction."
If you can afford to not go solo, consider reaching out and working with an expert.
3. Double-check every transaction.
As we mentioned above, the FBI has seen schemes in which scammers "attempt to divert your closing costs and down payment into a fraudulent account by confirming or suggesting last-minute changes to your wiring instructions," according to the Consumer Finance Protection Bureau's website. Make sure that you confirm any major changes such as these.
The organization also suggests that you never follow instructions contained in an email." Ask your realtor about all the details. "Verify the closing instructions, including the account name and number, with your trusted representatives either in person or by using the phone number you previously agreed to," the Bureau writes.
4. A wire transfer request, period, is a red flag when it comes to rentals.
Your best bet is to, simply, not wire money: If you're asked to wire money to pay a deposit, fees, or rent, it should be a major red flag. "The short answer to your question is don't send it," Mark Olson, who leads communications at Zillow, explains.
The Federal Trade Commission backs this up. "This is the surest sign of a scam," the FTC website says regarding wire transfers for rentals. "There's never a good reason to wire money to pay a security deposit, application fee, first month's rent, or vacation rental fee. That's true even if they send you a contract first. Wiring money is the same as sending cash — once you send it, you have no way to get it back."