When is the "Former Landlord" Not Really the Former Landlord?

Today property owners, property management companies and real estate professionals are faced with all types of identity risks, ranging from identity information theft of a residents’ confidential information, the failure to comply with new federal and state requirements to safeguard client confidential personal information, to the more obvious false applicant information. For a landlord, the applicant in front of you may not be the person they represent themselves to be; or the misrepresentation may be something less obvious to uncover. What if the “prior landlord” is not really a prior landlord?
Unfortunately it is not unheard of for an apartment applicant to provide bogus prior landlord references. Sometimes the references are actually relatives (like a mom who wants the applicant to get out of her house) and sometimes the bogus reference is a friend.
How can an owner or manager detect these bogus references?
It’s not always easy. It starts with always verifying the prior landlord references of all applications - no exceptions. And there are a few questions you can ask that may make it easier for you to determine whether or not the reference is really legit.
Some questions will reveal the fact that the landlord is not really a former landlord as the landlord reference will lack basic knowledge of the alleged tenancy or basic information about the property. In other cases, you will not know the real answer to the questions you pose, but the asking of the questions and the responses you get from the “reference” will give you the opportunity to assess the veracity of the reference based on their answers and voice demeanor. That’s not a perfect system, but it is better than nothing.
Be Prepared with Two Sets of Questions
First, when verifying the background information of an applicant, ask the reference if they are related by blood or marriage to the applicant. If they are, you need not stop the interview or completely discount the reference, but you should value the reference in accordance with the family relationship.
Second, ask the reference to provide you with details regarding the rental history of the applicant, such as the monthly rental amount, both when the applicant moved in and out; the move in and move out dates (month-day and year), as well as the security deposit amount and how much of the security deposit was returned or refunded. Ask for the building zip code. A friend may not know this, but a landlord will definitely know the zip code for their building.
The more questions you can ask about the tenancy, the greater the likelihood that one of your questions will not have been rehearsed by the prospect and their bogus reference, if in fact the reference is bogus. (There are other questions you should ask as part of your standard verification procedure regarding their suitability as a resident, but they are not related to the issue of the identity of the landlord and so they are not discussed here. For a list of the complete qualification questions you should ask a former landlord, visit www.MyRentalUnits.com.)
Some landlords may decline to provide any information other than Yes or No responses to questions; or they may only confirm information, citing company policy. Generally it is only the most sophisticated landlords that take this defensive position as part of their legal risk mitigation plan. For these instances have an alternative set of questions ready.
Suitable “Yes” or “No” and confirmation-type questions include:
- Did the former resident provide the required notice?
- Did the former resident pay $______ per month in rent [insert an amount you know to be incorrect or correct] per month?
- Was the security deposit $_____ [insert an amount you know to be incorrect or correct]?
- Did the resident move in/move out on [insert a date you know to be incorrect or correct]?
Create a series of questions which include both accurate and inaccurate statements. Make sure you request this information as part of your standard application package so you can go back and determine if the responses of the “reference” are accurate or inaccurate.
While you won’t be able to protect yourself from every scam-artist and avoid every fraud out there, you will reduce your chances of being taken advantage of, by following these consistent and thoughtful procedures. By following consistent best-practice procedures you will greatly increase your chances of revealing the bogus reference!
Article originally published by Merrie Turner Lightner, CFO and Vice President of Lightner Property Group and SF Rental Business Examiner, in the SF Examiner.
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