As a landlord, navigating the rental process involves finding the right tenants who will treat your property with care and pay rent on time. While the majority of renters are honest, some may attempt to manipulate the system for their benefit. Renter scams can arise from financial struggles, desperation, or pure opportunism, and being aware of these scams is essential for protecting your property and your financial interests.
Here are five common renter scams landlords should be on the lookout for:
1. Money Wiring Scam
In this scenario, a prospective tenant overpays with a forged check and then requests that the excess amount be wired back to them. Once the check is deposited and later bounces, the landlord is left with a financial loss, having sent the “refund” without realizing the check was fraudulent.
2. Falsified Documents
Some renters provide fake pay stubs, rental histories, or IDs to appear more qualified than they actually are. This can result in landlords unknowingly renting to individuals who may not be able to afford the rent or who have a problematic history they’re hiding.
3. Unauthorized Subletting
This scam occurs when tenants sublet the rental property to another person without the landlord’s consent. The tenant collects payments from the subletter and may abandon the lease altogether, leaving both the landlord and the subletter in a challenging situation.
4. Nonpayment of Rent
So-called “professional renters” know how to exploit legal loopholes to avoid paying rent and delay eviction proceedings. These tenants can live rent-free for months, causing significant financial losses for landlords. In some cases, they may even damage the property before vacating.
5. False Maintenance Claims
In this type of scam, tenants make up repair issues or overstate minor problems in an attempt to avoid paying rent. Landlords are forced to spend time and money investigating the claims, only to discover that no repairs are needed.
How to Detect Renter Scams
To safeguard against these types of scams, landlords can take several proactive steps:
- Verify Documents: Carefully review all documents provided by the tenant, such as pay stubs and rental histories. Cross-check details like formatting, pay amounts, and dates to spot inconsistencies.
- Confirm Employment and Rental History: Whenever possible, contact employers and previous landlords directly, using publicly listed contact information. This ensures you’re verifying rental history and employment with legitimate sources.
- Leverage Technology: Use online application processes, background checks, and secure payment platforms to minimize the risk of forged documents or fraudulent payments.
- Conduct Regular Inspections: After the tenant moves in, conduct routine property inspections to ensure the property is being properly maintained and to check for any unauthorized occupants or signs of property misuse.
By staying vigilant and implementing these practices, landlords can reduce the risk of falling victim to renter scams and better protect their investments.
