The caiman was found cooped up in an undersized tank in the homeowner's bedroom off Waterhouse Lane during a joint police investigation with the city council and the RSPCA.
The exotic reptile was seized by officials for re-homing after it emerged the owners did not have the proper documentation, issued under the Dangerous Wild Animals Act, to keep it.
"It was in a four-foot tank with nothing more than a cat litter tray which stank when I opened it up," said Ian Newby, of the Dangerous Wild Animal Rescue Facility (DWARF) in Little Wakering.
"There was a bulb for heating which had no guard and so it could have burnt itself, and it had been kept in dirty water straight from the tap.
"This kind of thing isn't uncommon, however.
"In the last ten years I've probably rescued 20 of these in Essex kept in front rooms or fish tanks.
"I have been running DWARF for more than 20 years so handling it was no problem for me, but if you're inexperienced it could take off fingers, or even a hand."
Caimans are normally found in South America and are from the same group of reptiles as crocodiles and alligators.
The one seized is believed to be a spectacled caiman. Males can grow to more than six foot in length, with the females reaching 4.5ft.
PC Andy Long, Essex Police Wildlife Crime Officer, said: "When we seized the animal it was fortunately still in reasonable health but it was being kept in a tank that was too small and was unable to submerge properly so I have no doubt that its health would have suffered if its current living conditions had continued.
"Animals like this need a high level of expert care, which is why a licence for their ownership is needed.
"If this animal had escaped into a public place then it would be more than capable of causing harm to members of the public."
The caiman has now been transported to the DWARF facility, where it can enjoy a 16ft enclosure while it waits to be re-homed.
If anyone believes they have information about exotic animals that are being kept either inappropriately or without the required licence, they can contact PC Long by calling 101.
