Renters in Toronto are being warned not to agree to prepaid rent requests from landlords after a person online said they were asked to pay for six months rent upfront for a potential apartment.
A screenshot of an email asking a prospective tenant to pay towards their eighth, ninth, tenth and eleventh month of tenancy in addition to a first and last month’s rent deposit in advance, was shared on Reddit earlier this week.
In total, the landlord was asking for close to $11,000 upfront.
The Reddit user, who says they are new to the city, was querying whether such a request was legal.
By law, landlords are only permitted to request first and last month’s rent.
According to the Landlord and Tenant Board, the maximum amount of a rent deposit a landlord can collect from a prospective tenant is the amount of rent for one rental period or the amount of rent for one month, whichever of the two is the lesser.
However, Marco Pedri, a Toronto real estate broker says, a “tenant can voluntarily offer any amount of additional rent upfront as they are comfortable doing so,” he told Now Toronto.
Reddit users were also quick to respond to the post, some even shared similar experiences with rent scams.
“Oof, all of these are red flags. I’m sorry OP 🙁 ‘landlords’, legit or not, can be real scummy and people take advantage of a crummy rental market,” one person commented.
“As someone who also recently moved to Canada and fell for a scam that looked a lot like this, this email reeks of scam to me. I was coming from a market where asking for several months of rent in advance was normal and legal, but, as I learned, it’s not here so I’d recommend erring on the side of caution with this offer,” another user wrote.
“SCAM. Stay away,” someone else said.
To protect against fraudulent landlords, Pedri recommends using a realtor with expertise in the rental market, and suggests that tenants familiarize themselves with their rights by reading the Residential Tenancies Act (RTA).
In addition to the prohibition of requiring more than first and last month’s rent, section 108 of the RTA does not allow landlords to ask a tenant or prospective tenant to provide post-dated cheques, nor does it permit automatic debiting of a tenant’s or prospective tenant’s account at a financial institution.
According to a recent tweet by Canadian brokerage Dorset Realty Group, rental scams are common in a tight market, and tend to target newcomers and students.
“Red flags to look out for include unusually low rent, missing reference checks, deposit requests without a signed agreement, shared property images, and refusal to meet in person,” the tweet said.
“Both the landlord and the tenant can not sign their rights away. Knowing your rights is very important,” Pedri concluded.
