How to Spot a Rental Scammer and Avoid Being a Victim Landlord

February 14, 2017

While most tenants are good people who won’t give you a bit of trouble, there are plenty who will make it tough to trust tenants at all when you’re a landlord. If you want to know how to spot a rental scammer, read on to learn common scams as well as how to protect yourself.

how to spot a rental scammer

Types of Typical Scams by Renters

Deadbeat Tenant

When most tenants move into an apartment, they have every intention of paying rent. Some may fall on hard times, though. That’s not the essence of this scam. This scammer never planned on paying rent. They get into the apartment and never pay a dime in rent. It takes months to have them removed, and the landlord is out the money for those months of rent. That gives them plenty of time to move on to the next victim.

Prevention

Always do a thorough background check on a tenant. You’ll need permission to do a background check, but any tenant who complains or refuses is one that you can avoid. Don’t take their printed background or credit check. It can too easily be faked.

Utilities Scam

A tenant may offer to pay the water bill or the trash for a lower rent. It could even be in the rental contract. Unfortunately, many landlords are left with high bills when it’s finally revealed that the tenant never paid. In most cities, the water won’t be turned off for non-payment, but the landlord will be responsible in the end. That will include late fees and supplemental taxes.

Prevention

For this particular scam, you might want to pay the bill yourself and raise the rent slightly to cover it. If you allow the renter to pay it, make sure to check on the bill occasionally to ensure it’s being paid.

Extortion Scam

In an area with many vacant buildings, the landlord will be more susceptible to an empty unit being broken into and a scammer claiming to be renting the unit. This has happened numerous times. A landlord will try to get the person removed, but the police will claim it’s a rental dispute when the person shows a fake rental agreement. The scam artist will try to get the landlord to pay money for the person to move.

Prevention

To remove a person like this from a property, landlords have gotten creative. The renter often doesn’t have electricity or is stealing it from a neighbor. The city code enforcer can make the people leave the dwelling immediately. To avoid this kind of scam, have a West Valley City property management company make sure your units are always filled with real tenants. Never leave empty apartments as attractions to scammers.

Overpayment Scam

This is a version of a scam that happens to other people as well as landlords. A prospective renter will be living overseas but wants to send you a certified check for the security deposit and rent. The scammer will send a check for more than the amount requested. It can often be twice as much. They’ll ask you to send back the overpayment. Later, it will turn out that the check was fake and the landlord didn’t get any money. They’ve also been scammed for the money they sent to the scam renter.

Prevention

Never rent to someone you’ve never met or done a background check on especially someone from another country. This is called the Nigerian Scam because the person will say they are from Nigeria. Even if the check appears to be real, it can bounce weeks later, and you’ll be responsible for the fees associated with that too.

How to Prevent it From Happening to You

As mentioned above, you always want to meet your potential renters in person. Real estate scams are hard to get away with when you have the person’s social security number to do a background check. Always perform background checks. Property managers in West Valley City know to have a process for properly screening all potential renters.

With your applications, have a list of criteria you expect from the tenant. It should include good credit rating, no evictions on their record and proof of income. When the scammer sees that you know what you’re doing, it’s unlikely you’ll see that person again.

Verify all information provided to you by the tenant. Ask for a fee to cover the tenant screening process. This will help offset the cost of screening each applicant. All of the application should be fully filled out by the potential tenant. You can return the application to anyone who didn’t fill it completely.

When verifying the person’s current employment, search online for their address and phone number to ensure it matches what was provided. Call the number listed online for verification. Don’t trust the number provided by the potential tenant.

Checking rental history means ensuring that you’re verifying ownership of the landlord’s property and looking up the phone number for the landlord online. You shouldn’t trust any number provided by the applicant.

Ask to get the tenant’s photograph for your records once you’ve done your screening. Scam artists won’t want a photo attached to their rental agreement. At the same time, once you’ve really vetted the tenant, they likely passed all the other checks. That means they’re not a scam artist. It doesn’t hurt to be too careful though.

Meeting the tenant, getting their social security number, taking their picture and verifying all the information you can online are a few ways to learn how to spot a rental scammer. You’ll want to authenticate and document every part of the process from start to finish. This will help you avoid being stuck with a nightmare tenant out to scam you.

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