Bamboozled. Hoodwinked. Duped. These are words that property managers fear when examining new tenant applications, but it seems that with every passing year these imposters add new tricks to their resumes, creating real problems for managers and other renters.
A recent survey from Snappt found that the number of fraudulent rental applications has shot up by nine percent during the chaos of COVID-19. While nine percent doesn’t seem like a colossal statistic, these are scammers we’re talking about! An increase in their popularity is not welcome. In a perfect world, we would all simply abide by the mantra that honesty is the best policy, but obviously, some people didn’t have that sign hanging on their living room wall as a reminder.
So, because of the actions of a few misguided individuals, property managers are forced to beef up their applicant screening protocols to rule out the fakers. In an effort to help managers sort through applications and stop these fraudulent applications in their tracks, we’ve compiled a few tips and tricks that we think are the most helpful.
Trust no one
We know this sounds kind of extreme and overly pessimistic, but it’s better to be safe than sorry. To be clear, we’re not advising you to straight-up treat new applicants like criminals (trust us that won’t be good for business), but it’s probably a good idea to operate under the assumption that your sleuthing skills are being tested.
There is an entire market out there for purchasing false documentation. From fraudulent pay stubs to proof of employment materials, it’s all out there for dishonest people to get their grubby hands on. It’s no wonder why you need to question whether or not someone is trustworthy. If there are blank spots on the application, their writing is hard to read, or they’re offering to pay you a large sum of money way too far in advance, those are red flags that something shady is going on.
Check for consistency
If someone is trying to pull a fast one, they’re likely to get caught in a lie somewhere if they have to repeat their story a bunch of times. Test them out by talking! We recommend that you prequalify new applicants over the phone (make sure to take notes on the answers they give you). By pre-screening your applicants, you’ll be able to cross-reference their initial information with their completed application or with information you find out during a property visit. If their story changes frequently, or they look like they are flailing when being questioned further, you might want to pump the brakes.
Make them nervous
Okay, we admit that this one might be a little “mischievous” because it involves psychological trickery, but it’s not harmful in any way! One of the top scams fraudulent renters use is providing fake documents, specifically fake IDs. When interviewing an applicant, you should ask to see their documents more than once and spend a good amount of time looking them over. This will show your potential tenant that you’re on the lookout for fakers and it might just scare off anyone who is trying to do you dirty.
Connect your own dots
While it might be your knee-jerk reaction to have a seemingly perfect applicant sign a new lease ASAP, you’ve got to remember that some things may be too good to be true. No matter the situation, it’s vitally important that you run your own background checks. One way to do this is to use an electronic screening service like First Advantage, E-Renter, or VeriFirst. You also want to make sure that you’re running their credit against the Landlord Credit Bureau database, this allows you, and other managers, to report bad tenants and catch the scammers.
If you don’t want to pay for a screening service, there are some things you can do to verify the legitimacy of documents provided by an applicant. Doing your own research into their listed employer is a good place to start. If their employment is what they say it is, you should find faces and names to back up their claims. You can also check the legitimacy of their previous address by verifying with their old landlord that they did in fact live there.
It’s a tough job, but someone’s gotta do it
It really stinks that we can’t be more “glass half full” about this whole thing, but rental fraud is nothing to think lightly about! Over 66% of evictions are due to fraudulent applications, and during a pandemic or any other high crisis situation, evictions are probably the last thing you want to be stressing over.
It’s important to prepare yourself against these scammers, and know if you’ve had to deal with this in the past that you’re not alone! In fact, two-thirds of property managers have claimed to be victims of renter fraud. Our hope is that the next time you find yourself screening an applicant, some of these tips come to mind. With some practice, we know you’ll be able to catch any potential culprits before they cause loss of revenue for your property.