Red Flags To Watch For On Rental Applications

Feb 17, 2018

Property Management Red Flags To Watch For On Residential Rental Application Cordon Real EstateScreening rental applications properly to prevent tenant problems later is one of a landlord’s most important jobs. Landlords must be careful to make sure applicants do not provide incomplete or false information, or worse – run an intentional rental scam. Here are five of the most common red flags seen on rental applications, with examples of possible scams that may relate to the flag.

1. Credit Report Provided With Application

Credit reports  submitted with rental applications can be outdated or may have been drawn just before the applicant did something they believed might negatively effect their credit score or history. Landlords should always run their own credit report.

Scam: Applicant runs credit report to provide with rental application, next day buys car with payments that reduce their net income below qualifying limit.

Scam: Applicant is committing identity theft and is trying to rent using another person’s name and credit.

2. Self-Employed Applicant Cannot Verify Income

Applicants have several methods available to verify self-employment income, including tax returns and bank statements.  Undocumented income should not be considered in qualifying applicants.

Scam: Income is from illegal activity.

Scam: Income is received in cash that is not claimed on applicant’s income taxes.

3. No Contact Information For Current or Past Landlord

Past landlords can be very helpful in providing information regarding their past tenants. Evictions are usually public records, but late payments and lease compliance issues typically are not.

Scam: Applicant may provide name and phone number of someone posing as a landlord.

Scam: Tenant may stop paying rent or abuse the property, then leave just before the landlord files eviction papers.

4. Employment Verification Phone Number Is A Cell Phone

Employment situations vary, but landlords should be careful to verify that the employer exists and that when they call they are speaking with the appropriate person. Ask the applicant for the personnel manager’s contact information, not a co-worker or supervisor.

Scam: Phone number may be someone posing as an employer.

5. Applicant Offers Up-Front Rent Payment

Offers to make up-front payments are often an indicator that the applicant may problems with credit, income or employment.

Scam: Applicant is laundering illegally obtained cash.

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