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5 Signs Your Real Estate Broker Isn’t Legit (Photo: iStockphoto)

5 Signs Your Real Estate Broker Isn’t Legit

If you know anything about New York City real estate, you know that anything too good to be true usually is, and that unscrupulous real-estate brokers can take advantage of people new to the city and its unique apartment-renting ways. (In most other cities, brokers are a rarity.) One common scam involves answering an ad on Craigslist, just to be told that the owner is out of town and unable to show the apartment… but if you’d be so kind as to send a large sum of money via Western Union the keys will be mailed to you immediately. Believe it or not, some people actually fall for that scam, and end up at a vacant lot or knocking on the doors of a condo building that’s never heard of them. So how do you protect yourself from being taken advantage of by a shady broker? Here are five ways to tell your broker isn’t on the level—and how to avoid getting ripped off.

 

Brokers who refuse to answer questions. Under New York City law, brokers are required to disclose certain facts about an apartment: whether it was the location of any crime; whether it contains lead paint, mold, or environmental hazards; whether it’s been infested with bed bugs in the last year; and whether it’s ever been flooded or structurally damaged. Make sure you find out as much information as possible about the apartment and the building’s history. A reputable broker will have no problem finding out the answers to any of your questions, and he or she will also have the same answer every time you ask the question. If a broker’s answers to your queries change over time (especially concerning the terms of the lease, such as the rent or other fees), that’s a red flag. Another important point, from Gus Waite, the social media director for A.C. Lawrence Real Estate: “If your broker does not ask you to sign a New York State disclosure form [which explains who the broker represents] at your first meeting before showing you an apartment, they are breaking the law.” Waite says brokers should also be asked to sign a fee agreement before you see any apartments; this outlines what fees you’ll be charged if the broker finds you a place.

 

Brokers who won’t give you a timeline of how things will progress after you pay the application fee. Tasha Trice, Vice President at A.C. Lawrence, says she’s encountered many clients who come to her after paying a deposit along with their application fee but then never hear back from the broker who took their money. She suggests that clients “read all the fine print and make sure to get a receipt as well as something documenting what is expected,” for example, the time frame in which they’ll get a response. Clients can prevent this from happening by getting a receipt and documenting what the next steps are in the application process after the fees are paid. Try to pay with a credit card if you can, so you can be protected if you somehow lose the money.

 

5 Signs Your Real Estate Broker Isn’t Legit

Renter Beware (Photo illustration: Mary-Louise Price Foss. Photos: Mario Tama/Getty Images, iStockphoto)

Brokers who ask for money in advance of signing a lease. Other than the application fee, you shouldn’t be asked for any money (especially large sums) until the lease is signed and you have the keys to the apartment. Vicki Negron, a Senior Vice President at Corcoran Real Estate’s Brooklyn Heights office, agrees, saying that “asking for money in advance is one of the biggest signs” that a broker isn’t on the level. There really isn’t any way to deal with or prevent this sort of thing, other than going with a different broker who doesn’t expect you to do this (and, of course, refusing to give people money before anything is signed).

 

Brokers who are very pushy. Even though things go quickly in NYC, it’s still a red flag if a broker is pushing you to make a decision now. Louise Vargas, a Washington Heights landlord and former broker, says that no one should be pushing you to decide about an apartment on the spot. “It’s one thing to ask for an application fee to get things moving,” she says. “But to demand a security deposit or a broker’s fee after you’ve just seen the apartment for the first time is definitely a bad sign.” She suggests being up front with brokers about your timeline and remaining firm if you feel pressured. And if the broker still won’t relent, she says, “find a new broker who has patience.”

 

Brokers who ask for cash. Negron says the second most telling sign your broker isn’t reliable is if he asks for cash. Noah Freedman, a broker for Bond Real Estate in Manhattan, says “giving money to the broker only at the broker’s office and getting a receipt for everything” is one way to prevent getting scammed. Bob Brooks, A.C. Lawrence Senior Vice President, says you can avoid pressure to come up with cash by making sure you meet at a broker’s office first. “Many times rogue agents meet clients at an apartment and ask for deposits in cash,” he says. “You should only give deposits in the broker’s office, never at the apartment.” Freedman offers an additional tip that bears repeating: use a credit card for everything. “Credit card companies protect you against scams,” he says.

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