10 Ways to Catch Fraudulent Applications
By Robert L. Cain, Copyright 2020 Cain Publications, Inc.
One in three rental applications contain some kind of fraud, reports snappt.com. in 2020, the company surveyed property managers and came up with that figure and others just as telling revealing the carefully generated fake documents landlords see on rental applications. It’s usually income, but it can be far more devious than that. Of those who admit it, says the snappt.com report, two of every three property managers have been fooled at some time by phony documents.
It’s easy to create a phony document, one that will fool many people, including landlords anxious to get a unit rented. Time was when tenants had to work harder to come up with doctored documents to prove their rent-worthiness. Now all it takes is a visit to a website.
I checked out a few of those websites. Fakepaystubs.net, pay-stubs.com, and thepaystubs.com all promise quick and easy documents to prove whatever you want proved. Fakepaystubs.com, for example, provides instruction and services for
“How to edit my paycheck stub
How to get my check stub online
Create a pay stub
How to edit a scanned document
Online PDF Editor
PDF Editor Service for Paystubs
Editing Scanned Documents
The PDF Editor Service
Editing Fake Paystubs Service
Editor of Fake Paystubs Service”
In addition, beside fake paystubs, they will create bank statements, credit reports, utility bills, credit card statements, and tax returns, running the gamut of documents meant to fool the less than diligent landlord. Of course, they insist that they are just for fun and should never be used in real life; “Services provided here are only for Novelty, Education and Entertainment purposes.” Another site even offers two people pretending to be employers and previous landlords to answer calls from anyone checking the application.
All of this has become epidemic recently because of how easy it is to create documents online. With due diligence, you can easily flush out fraudulent documents and applications. The most important point is: BELIEVE NOTHING ON A RENTAL APPLICATION UNTIL YOU HAVE VERIFIED IT.
Find out after they have completed their fraud and moved in, and you most certainly have the right to evict these tenants, assuming you can actually still evict where your property is. The average eviction though, reported the Snappt.com survey, costs $7,685. And that’s just for the cost of the actual eviction. It doesn’t include the lost rent and property damage done by a bad tenant. Never allowing them move to in to begin with provides the best protection for your investment.
Here are 10 things to do to ferret out a fraudulent application and keep from renting to a lying tenant.
- Make sure the application is completely filled out, no exceptions. If your applicant has a bad attitude about your insisting it’s completely filled out, simply reject the application.
- How do the documents your applicant submits look? Are the numbers, account numbers, phone numbers, income figures, everything the same across all documents? Look at formatting to see if it is consistent in documents from the same source. For example, does a bank statement look like the actual bank statement from that bank? Check spelling and grammar. Spelling and grammar errors are a sure sign of fraudulent documents.
- Call the telephone numbers on the application and documents to make sure they are working numbers. Then compare the phone numbers on the application with the phone number of the current and previous employers, the ones you find on the employers’ websites or in the phone book. No website? Be extremely careful.
- Verify start and end dates with employers and landlords to make sure they match what’s on the application. If they don’t, ask your applicant about missing periods of time. The answer had better be good. Check with the current and previous employers to verify income. Don’t rely on possibly phony paystubs submitted by the applicant.
- Look at Facebook and LinkedIn pages and online databases such as opencorporation.com and sba.gov to make sure the applicant’s employer is real.
- Check the applicant’s credit report to see if the dates and addresses match up with what’s on the application. Don’t rely on a credit report an applicant provides; pull the report yourself.
- Do a Social Search to see if the Social Security information is the same as what’s on the rental application. People using a phony Social Security Number will show up with different names, addresses and dates than those claimed on the application or not show up at all.
- Call previous landlords for references. Check to be sure the phone number you are calling actually belongs to the landlord or manager and not a friend posing as a property owner. One suggestion I saw recommends calling the numbers of previous landlords and asking if they have a two-bedroom unit for rent. If they answer that you have the wrong number, that waves a huge, spotlighted red flag. Check county tax records online to see if the name of the property owner is the same as the landlord’s listed on the rental application.
- If you still haven’t rejected an applicant after finding inconsistencies, ask the applicant to provide hard copies of the documents or to print out the documents in your office.
- Spend the time to do a proper screening job. The Snappt.com survey reports that property managers spend between four and ten hours on each application. Whatever time spent will be worth it if you find a fraudulent application and spare yourself a bad tenant and an eviction.
You don’t have to check every application if you screen in the order the application is received. The first acceptable one, the one that meets your strict rental standards and passes muster can be the one you accept. Just be sure to make your rental standards are so meticulous that anyone who meets them will be an acceptable tenant.
Bad tenants, tenants who have a spotty or horrible rental history, are not going to start being good little boys and girls. They’ll keep up their tricks as long as the tricks work and will learn new ones when the old ones wear out. They’ve worn out their welcomes everywhere they’ve lived. Don’t let them add your property to the list.
Written for Zip Reports where they provide applicant screening services.