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Landlords Beware - Rental Fraud Is On The Rise

Application fraud is growing in residential rental markets since the COVID-19 crisis, according to a new analysis from Snappt, a real estate tech and fraud detection company. Applicant fraud has risen 9% month-over-month since the pandemic. Snappt researchers say that it’s likely a response to the economic climate as well as recent changes to local and state eviction moratoriums.

“There are a number of factors that are fueling the increase in fraudulent rental applications,” says Daniel Berlind, CEO and co-founder of Snappt. “The increasing number of self-employed applicants, a move to online rental applications, and the increasing availability of tools to fraudulently alter financial documentation all make the problem more common.”

Two thirds—or 66%—of property managers surveyed by Snappt say they’ve fallen victim to fraudulent rental applications. Here are the top five problems property managers are reporting from fraudulent lease applications:

  • Costs associated with having to evict bad tenants

  • Physical damage to the property

  • Missing out on renting to good tenants

  • Criminal activity at the property

  • Loss of reputation

It costs property managers an average of $7,685 per eviction, according to the report.

Landlords should always take the time to carefully research each application they receive and do all you can to protect your investments.

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Source: National Association of Realtors and Snappt

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