How to Avoid Scams While Screening Tenants

Maybe your prospective tenant has a history of trashing properties.

Maybe they set up in one place and then don't pay rent, and wait for the landlord to go to the time and trouble to evict them.

Whatever the case, some people are problem tenants and don't want you to know.

If a problem tenant is savvy, they'll use certain tricks to circumvent the screening process.

Here are some of the most common ones, and how to avoid them.

Putting Down Friends or Family as References
If tenants don't have good rental references, they may try to fake it.

They'll put down family members or personal friends in lieu of actual rental references, so that the loved one can make a good case for the problem tenant.

Your best defense against this is to research your tenants' references.

Do a little homework to find out who owns the property, and as much information as you can about the contact person who's listed.

If it seems unlikely that they own the property, you may have found a scam.

But even if you do this research, a clever tenant may still be able to bamboozle you.

Because this is one of the easiest parts of the application to falsify, many landlords don't weigh references very heavily when screening an application.

Falsifying Proof of Residency or Employment
Maybe your tenant is turning in a utility bill or a pay stub as proof of residency or employment.

That might be legitimate, but there is a black market in verification documents, and if a prospective tenant is particularly skilled they may have forged their own.

When you're looking at one of these verifications, always do your own research to corroborate.

Does the address they're verifying exist? If you call the place of employment and ask to speak to a supervisor, does the applicant actually work there?

Providing Their Own Credit Report
Some tenants will try to help you out by providing their own credit report.

That might be innocuous, or that might be an attempt at pulling a fast one on you.

Sometimes the numbers on the credit report have been altered, or the whole document may have been entirely falsified.

Always run your own credit report on prospective tenants.

Go through the whole thing, line by line, and don't be afraid to educate yourself on how to interpret the report.

Fraudulent Checks
We're not just talking about checks bouncing.

One particularly well-known con involves a prospective tenant offering you a large "employer's check" for the security deposit, which they ask you to cash and then send them the remainder.

You write the check, but then the fraudulent employer's check bounces, and the individual falls out of contact with you.

Don't be afraid to look for more information about the employer in a case like this, and always examine the check for authenticity.

If a tenant asks you to write you a check for the remaining sum, always wait to do so until the check clears.

Better yet, just ask them to go back to their employer and have the employer pay them, so they can then write their own check.

Unfortunately, there's no failsafe way to make sure that your tenants will pay on time and take good care of your property.

But a good screening process is still one of the best ways to protect yourself.

With some knowledge of the most common scams and falsifications that tenants put on applications, you can avoid some serious problems down the road.


Posted on Dec 21, 2015


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