How to identify tenant fraud before it leads to more evictions
How to identify tenant fraud before it leads to more evictions
The wrong information can lead to evictions. A firm managing 3,500 units with a 20 percent eviction rate may endure 600 evictions every year, totaling over $1 million per year in expenses related to fraudulent rental applications alone. The typical property manager in a 2020 study by ReRez Research says at least 15% of evictions involve tenants who submitted fraudulent applications.
Tenant application fraud that goes unchecked inevitably leads to evictions
The deception of application fraud can vary: some applicants inflate their income; others hide it or disguise its source to cover illegal activity. With the presence of image manipulation technology combined with affordable advanced personal scanning equipment, it is much easier to change and edit a document and convince someone it is real. This along with COVID-19’s rise in unemployment rates have led to the increase in fraudulent rental applications.
How to identify rental fraud
To avoid the eviction process, property managers must be even more diligent when vetting applications. Technology-enabled tenant screening software combined with good-old-fashioned manual reviews are the secret sauce to getting it right.
“If someone understands the law, they can stop paying and live rent-free for six months while we work to evict them,” according to Chad Vasquez, general manager of Circa LA. “That’s $150,000 for one of our penthouses.”
Some ways to reduce fraud also include:
1. Review documents for visual cues, checking for obvious inconsistencies such as misaligned numbers or degraded quality of t……
The wrong information can lead to evictions. A firm managing 3,500 units with a 20 percent eviction rate may endure 600 evictions every year, totaling over $1 million per year in expenses related to fraudulent rental applications alone. The typical property manager in a 2020 study by ReRez Research says at least 15% of evictions involve tenants who submitted fraudulent applications.
Tenant application fraud that goes unchecked inevitably leads to evictions
The deception of application fraud can vary: some applicants inflate their income; others hide it or disguise its source to cover illegal activity. With the presence of image manipulation technology combined with affordable advanced personal scanning equipment, it is much easier to change and edit a document and convince someone it is real. This along with COVID-19’s rise in unemployment rates have led to the increase in fraudulent rental applications.
How to identify rental fraud
To avoid the eviction process, property managers must be even more diligent when vetting applications. Technology-enabled tenant screening software combined with good-old-fashioned manual reviews are the secret sauce to getting it right.
“If someone understands the law, they can stop paying and live rent-free for six months while we work to evict them,” according to Chad Vasquez, general manager of Circa LA. “That’s $150,000 for one of our penthouses.”
Some ways to reduce fraud also include:
1. Review documents for visual cues, checking for obvious inconsistencies such as misaligned numbers or degraded quality of t……