Summary

Rental scams are on the rise, and one particularly deceptive scheme tricked thousands of apartment hunters into paying nearly $30 a month for a credit monitoring service they didn’t intend to purchase. Disguised as part of a rental credit check, the scam misled renters using fake or hijacked ads on Craigslist. Understanding how rental credit checks should work and how to safely obtain your credit score can help you avoid falling victim to similar cons.

🔍 Understanding Rental Credit Checks

When searching for a rental, it’s common for landlords to require a credit check. However, there’s a process to follow—and if a landlord demands credit information before you’ve even seen the unit, that’s a red flag. Typically, credit checks occur after you submit a rental application and provide written permission. Be cautious if you’re sent to a third-party website to retrieve your own credit score, especially if it asks for your credit card information. In many scams, unsuspecting renters are lured into signing up for recurring payments disguised as free credit checks.

Takeaways:

• A landlord must get your permission before checking your credit.

• Credit checks often happen after you’ve viewed the unit and submitted an application.

• Be wary of any request for a credit card number under the guise of a “free” credit score.

Key Terms

• Hard Inquiry: A type of credit check that may temporarily lower your credit score by a few points.

• Tenant Score: A credit score model used specifically for rental applications, which may differ from your general credit score.

• Credit Monitoring: A service that tracks changes to your credit report, often for a monthly fee.

🚩 The Risks of “Free” Credit Scores

Many services advertising “free” credit scores come with strings attached. In the Craigslist rental scam, renters were sent to a third-party website that required a credit card number to get a “free” score. What many didn’t realize is that they were also signing up for a subscription service, billed monthly unless canceled quickly. To avoid these traps, steer clear of any site that requires payment information for something advertised as free. Instead, opt for well-known platforms like certain personal finance websites or credit card issuers that offer genuinely free scores with no hidden fees.

Takeaways:

• Be skeptical of “free” offers that ask for your credit card number.

• Read the fine print when signing up for any service online.

• Use reputable sources for checking your credit score, such as your bank or a trusted personal finance site.

Key Terms

• Free Annual Credit Report: A legally guaranteed yearly credit report available from each of the three major bureaus at AnnualCreditReport.com.

• Fine Print: Terms and conditions that are often buried or presented in hard-to-read text, where hidden fees or recurring charges may be disclosed.

🛡️ How to Stay Safe from Rental Scams

Protecting yourself from rental scams starts with vigilance. If something feels off about a rental listing—like requiring payment before viewing or asking for wire transfers—take a step back. Always research listings, double-check details, and avoid giving out sensitive information unless you’re sure of the service. In the FTC-investigated scam, some renters didn’t realize for months that they were being charged. Monitoring your credit card statements regularly can help you spot unauthorized charges early. Finally, report any suspicious activity to the FTC to help stop the spread of these scams.

Takeaways:

• Never wire money or pay for a rental you haven’t seen in person.

• Verify listings and search online for duplicate postings or landlord reviews.

• Review your credit card statements monthly for surprise charges.

• Report scams to the FTC to help protect others.

Key Terms

• Wire Transfer: An electronic transfer of funds that typically cannot be reversed, often used in scams due to lack of consumer protections.

• FTC (Federal Trade Commission): A U.S. government agency that protects consumers from fraudulent, deceptive, and unfair business practices.

Conclusion

Scams like the Craigslist rental scheme remind us how easy it is to be misled during something as common as a credit check. Knowing what to expect from the rental process and how to safely access your credit score can help shield you from deceptive practices. Stay informed, ask questions, and always double-check before providing personal or financial information.