Landlords Beware of Common Tenant Scams

Rental application fraud has been increasing, especially post- COVID. It has become a cottage industry, with people selling their services to help fake pay stubs and employment verification so applicants can rent units that they otherwise do not qualify. In addition, some applicants move in and commit additional fraud. Here are a few things to be watchful for if you are leasing.

Fake Paystubs/ References

During COVID I saw countless videos of people that would photoshop fake paystubs for people looking to rent that did not have the credit or were unemployed but needed to move. These paystubs were very convincing and people commented that they got an apartment with a fake paystub.

An application can have a phone number of a landlord or employer reference that goes directly to a friend or family member. It is good to do a search on the company or even a search of the phone number itself.

Don't accept references at face value. Also, always check bank statements to make sure (1) the paystubs corresponds to a direct deposit or check deposit of the same amount around the same date as the stub and (2) to show proof that an applicant is currently paying rent, usually a withdraw from the same bank account.

Leasing Vacant Units

A tenant knows there is a vacant unit at the property. The property may be a small one with no resident manager or one that a owner/ property manager does not frequent too often.

The tenant posts a craiglists, VRBO, AirBNB, Facebook, or other similar ad for the vacant unit. The tenant then changes the locks on the unit, collects money and gives keys out to someone totally unknown to the landlord.

How landlords find out is usually when they go to do a showing and the unit has someone living inside of it. The stranger in the unit often is under the impression the tenant was the actual owner, property manager or that they were in a sublease agreement approved by the actual owner/ property manager. These people usually don't qualify for an apartment and are desperate. They ads are too good to be true, yet people fall for them. Another red flag- the agreement is a text message and payments are done through Venmo or Zelle.

Leasing and Moving Out

I've seen matters where a tenant is not paying rent or seems to be missing. The owner/property manager posts an eviction notice for non-payment of rent. People come forward saying it is not possible to get an eviction notice because the person (owner or property manager) does not own the property and they are paying rent. Proof is usually a Venmo or Zelle screenshots.

These people were told by the tenant that the tenant was the owner or property manager. Tenant gets paid rent money every month, doesn't live in the unit, and doesn't pay rent to the actual owner/ property manager. It may take several months before the owner/property manager is able to serve an eviction notice.

Tenants leasing, subleasing or otherwise holding out as the owner/ property manager occurred quite a bit during COVID because landlords were severely restricted on evictions for non-payment of rent. Tenants could cash in on collecting rent from strangers, not pay rent and even be applying for and getting rent relief assistance all while not even living in the unit any longer.

Tenants didn't face recourse because they often never met the stranger they moved in. They would send a friend. Leave a key under a mat. Even if they did meet, they would be long gone before anyone became the wiser.

If you take anything away from this (besides a new nightmare and declining hope in humanity) it is that vetting applications and routine checks on your property can go a long way in preventing this from happening to you. For those apartment hunting, if an ad looks too good to be true and requires no rental application it likely is a scam.

The information in this post is for general information purposes only. Nothing on this post should be taken as legal advice for any individual case or situation. This information is not intended to create, and receipt or viewing does not constitute, an attorney-client relationship.