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The off-campus rental trap; College students looking for cheaper housing should beware of misleading sales pitches at for-profit apartment complexes

The biggest lesson Deb Elliott's son has learned so far in his college career happened outside the classroom.

When he and three friends began looking to move out of the dorms and into an apartment setting at the University at Buffalo, the Villas at Chestnut Ridge caught their eye.

The very friendly and helpful salesman there said the apartments go quickly, so in order to hold their place, they would have to sign some papers and put down a refundable $200 deposit.

He told them nothing was binding because they didn't have jobs and therefore couldn't qualify for a lease without a guarantor's signature. But a signature would keep the apartment open until they could make a decision.

"He kept saying, 'Don't worry, we'll mail the papers to your parents. Nothing will be final until they sign,'" Elliott said. "'Oh, and by the way, whichever one of you signs first gets this free T-shirt.'"

But when the students' parents had a look at the lease with their attorneys and decided the apartment wouldn't work after all, they found the salesman had changed his tune, they said.

Not only did their sons' signatures mean the lease was binding, but it would cost them each a $200 release fee to get out of it, and they would be responsible for finding new tenants to take their place.

"Unfortunately, it's not the first time we've heard these allegations about the complexes," said Dan Ryan, director of off-campus student relations at UB.

Many parents and students have come to his office with complaints, assuming the apartments are affiliated with the university.

UB has its own dorms, and so the university is competing with the private companies for student tenants. Housing students is a lucrative business, so the competition can be strong.

"We're in an awkward spot, especially with the complexes around North Campus that are sort of advertised in some ways to imply that they're part of the university when they're not," Ryan said. "That's an issue we have to deal with on a regular basis."

The bulk of complaints the university receives about the for-profit complexes pertain to misleading sales tactics used to get students to sign a lease.

"If a student signs something and he's of age, typically there's not much that can be done," Ryan said. "That's when I usually turn them over to an attorney, because I'm in no position to be giving legal advice. I don't know of anyone who has gotten around it."

But Elliott's son and friends did get out of the lease -- after more than a month of talking to the leasing manager, general manager and regional manager, and eventually the corporate offices in Austin, Texas.

"They reluctantly refunded their security deposits and voided the lease -- after we told them we had talked to the Better Business Bureau, the press, the attorney general and had an attorney on board," Elliott said.

But a spokeswoman for American Campus Communities, the company that owns the Villas and five other complexes near college campuses in Western New York, had a different take.

"We investigated the allegations and found that the employees followed proper protocol," said Gina Cowart, a spokeswoman for the company. "But, as a gesture of goodwill, we came to a mutually agreeable resolution and let them out of the lease."

Cowart said the company has never received any other complaints about students being coerced or misled into signing leases, or otherwise fraudulently obtaining signatures, but declined to answer further questions.

Still, UB has found such aggressive sales practices common enough to take what little action it can against them.

"We've done workshops to try to educate people about this exact scenario," Ryan said.

In addition to the tactics taken to get students to sign leases on the spot, the leases themselves can be unfavorable to tenants of the complexes.

At orientation and open house, the university tries to make students and parents aware that there are law students and an attorney standing by as part of its sub-board legal services who will read over a student's lease for free before they sign it.

Still, it's impossible to reach everyone. And Elliott worries how many other college students might fall into the same trap.

Scott Jaschik, editor and co-founder of education publication Inside Higher Ed, said the practice of landlords taking advantage of inexperienced college students has been happening in college towns across the nation for years.

"The reality is that many students are in their first experience dealing with a landlord, don't know their rights and may have opted for a less expensive housing option over other factors," Jaschik said. "I haven't heard about overt coercion, but I think that if you are a student, and you worry that the closest spots to campus are going fast, you may not think through all of your rights."

Even if potential tenants aren't misled, Elliott doesn't like that students are urged to sign a lease before showing it to an attorney, and offered incentives like T-shirts and backpacks to quickly sign a binding document.