How to Avoid Today’s Top Tenant Scams

by Chris on October 21, 2019

In a tight rental market, landlords need to tighten their tenant screening practices as well. Tenants who never gave a second thought to late rent payments or property damage now can find themselves unable to qualify. So, they get creative.

Social media makes it easy for tenants to share their thoughts and ideas when it comes to scamming landlords. Fortunately, landlords can view some of these posts, too, and learn to spot today’s most prevalent tenant scams:

1. Target an experienced or lax landlord because they don’t do tenant background checks.

The simple fix: Demand a tenant background check. No exceptions.

2. Supply a fake credit report.

Credit reports need to come directly from the credit bureau to guarantee the report has not been altered. Cut out the “middleman” and prevent tenant fraud.

3. Don’t provide your previous address on the rental application.

Tenants often believe that an omission is not the same as telling a lie. Warn tenants that incomplete applications will not be considered.

4. Use the wrong number for your previous landlord.

This trick is as old as the hills, but still in play. Explain that the application will not be processed if references cannot be reached.

5. List a work reference who doesn’t work there anymore.

Demand supplemental documentation to verify employment and income and warn tenants that inaccessible references will only stall the application.

6. Offer to pay cash (or higher rent) to avoid a credit check.

Too many landlords fall for this trick. The tenant may have cash now, but not three months from now. A promise to pay higher rent rings empty when the tenant isn’t planning to pay rent. Don’t be fooled. Make verifiable income a qualification requirement. Also, sign up to Report Rent Payments with TVS and warn tenants that late or missed payments will only make their credit problems worse.

7. Move in with someone else who has better credit or rental history.

Ask for a list of proposed occupants and demand that all adults complete rental applications. Explain the guest policy to applicants — and the consequences for unauthorized guests.

8. Lie about pets (or non-smoking, or additional occupants).

Intentionally concealing information to scam a landlord is fraud, and tenants should be warned about that. Explaining that a lease-breaking tenant will be evicted — and will need to move once again — can prevent this scam.

9. Leave pet information (or smoking preference) blank on the rental application.

Adopt a standard policy of rejecting incomplete applications.

10. Inflate income.

The most brazen scams involve inflating income. These tricks range from adding a year-end bonus to monthly income to scanning and doctoring pay stubs, depositing borrowed money, or hiring a third-party to falsely verify employment. That’s easier than you might think. Today, for about $75, a tenant can create fictional employment, income, and a reference online. These fake verification companies have gone so far as setting up websites and advertising on Craigslist.

Landlords should avoid online applications where supplemental documentation easily can be altered. It is also important to run a tenant credit check as a final step to confirm that employment history and credit match up.

These common scams — and others — can be avoided simply by following a tried-and-true tenant screening policy:

When advertising a vacancy, state that a tenant background check will be required;
Prequalify applicants over the phone and create a baseline of information to compare to the rental application;
Verify the applicant’s identity with a photo ID;
Demand a fully completed rental application and supplemental documentation;
Include language in the rental application that warns of the consequences of false or incomplete information;
Verify the information in the application, including checking references; and
Run tenant screening reports to confirm that the applicant is qualified.

Not all tenants are scammers. Some make innocent mistakes. Others have spotty records but still may be good tenants. Assure prospective tenants that some problems can be resolved and encourage applicants to be upfront about those issues. Make it easier for tenants to do the right thing, and harder for them to lie.

This post is provided by Tenant Verification Service, Inc., helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening, Tenant Background Checks, (U.S. and Canada), as well as Criminal Background Checks, and Eviction Reports (U.S. only).

Click Here to Receive Landlord Credit Reports.

Disclaimer: The information provided in this post is not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.

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