Being involved in property rental can be risky, even if you have many years of experience as a landlord. With the technology developing so fast and the economy dictating the business rules, landlords across the country are facing concerns about the ongoing increase of tenant scams.
Tenants scamming landlords is always a hot topic in the industry discussion and something everyone involved in the rental industry should know about. In this article, we are bringing you some of the most common scams that landlords face.
Read along and use these pieces of information to avoid becoming a victim.
Some tenants provide fake credit reports
Among the first tenant scams that come to mind is the fake credit report. We cannot emphasize enough how important it is to run a tenant credit check yourself. Even though it may be time-consuming, it can save you a lot of trouble.
Suppose you run into a tenant who has a well-prepared credit report with a great score. You give them the keys, and they sign a lease, even though the truth behind their credit score is far from good. Now, you have the option of running an eviction if necessary. But think how costly and time-consuming the process will be.
If you had checked the credit report yourself, you wouldn’t be in such an unpleasant situation. So, always remember to double-check your tenant payment history and focus on proof that the credit report the tenant provides is legitimate.
Tenants scamming landlords by subletting without permission
In some states like New Jersey, subletting with the landlord’s permission is entirely legal. But what happens if a tenant sublets an apartment without even asking the landlord first? That is undoubtedly one of the most common scams landlords come across.
Even though New Jersey Tenant Landlord Laws allow the tenants to sublet with permission, many landlords choose not to approve. What is more, they tend to put a specific term in the contract to stop subletting. It proves to be a high-risk, low reward situation that is best to avoid. Unfortunately, with so many people trying to scam their way into the rental industry, one cannot be too vigilant.
The eviction process can be tedious even when there’s no scam involved
Many landlords always complain about having to drag out the eviction process for a long time by accepting partial rent. Every time a tenant pays you, even if the amount is smaller than they owe, you have to reset the eviction process.
The rules of giving eviction notice depend and differ from state to state, but one can expect one month to a three-month notice. Every landlord should learn how to write an eviction notice because situations with tenants not paying rent, damaging the property, or subletting without approval will happen more often than not.
In case of eviction, tenants sometimes have to move in a week. So, they have to use some tricks to relocate in no time. Even if the landlord gives them a month’s notice, tenants will sometimes wait until the last week of rent to relocate, and organizing a move in a week is extremely difficult. Still, even though it is complicated, it’s possible and doable.
Beware of tenants who use false documents when applying for a lease
Sometimes, it is pretty easy to distinguish between real and fake tenant application documents. However, there are times when you, as a landlord, can skip through the papers, not paying enough attention to all the details.
For example, the tenant employment records can be vague or the reference letters fraudulent. This is why it’s important to always follow up on landlord reference letters you receive from tenants. If you come across such documents, you can be sure you are dealing with a professional scammer.
Falling into a scam of letting a property to a person who created a whole persona to avoid liability and most probably skip payment can cost you a lot. So, be sure to check and double-check everything. Don’t let the scammer’s imaginary story distract you from focusing on the documents.
Some tenants do not disclose the correct number of co-tenants or guests
If there is no contract stipulation about who can reside at the property, tenants can omit the number of people living at the property. They might choose not to share information about members who have legal issues, bad credit scores, or criminal history. That is not legal nor advisable, and it can pose a significant liability for the landlord.
It is essential to do thorough tenant background checks and learn more about who you are leasing to. Hopefully, you will be able to stop any attempt of fraudulent activity. You can do this by reducing the risk of unapproved co-tenants or guests living at the property.
Sometimes, people have to organize a last-minute move. Such relocations can be pretty overwhelming, especially when you don’t have anywhere to stay. So, these people need to get ready for an unexpected move and leave their apartment.
In these cases, some may choose to go and stay with friends, which is perfectly fine, as long there is mutual understanding among tenants and landlords. Like in every business relationship, good and open communication is essential and can make a difference.
In the end, it pays off to be vigilant
All the examples of tenants scamming landlords are only the tip of the iceberg. As in every business, some tend to break the rules and take advantage of decent, working people. Do not let yourself be a victim of a tenant scam.
Instead, educate yourself on how to conduct proper background checks and credit report scans. With a bit of training, you can become fully aware of all the possible fraudulent activities involved in getting a lease.