Title fraud and rental scams are creeping into the property world and causing chaos. In fact, more than 70,7% of major apartment landlords reported a spike in fraudulent rental applications in 2024, according to the National Multifamily Housing Council and the National Apartment Association.
The problem? Loopholes in eviction laws and backlogged courts have made it much harder to remove bad tenants. Some COVID-era tenant protections are still in play, making evictions even rarer. And fraudsters are capitalizing on this like it’s a clearance sale.
Rental scams come in many flavors. Sometimes, renters aren’t who they claim to be. Other times, they exaggerate their income or fabricate financial documents. And with many properties offering enticing move-in specials,like a free month’s rent,scammers move in, enjoy the perks, and vanish when it’s time to pay. Property managers, unfortunately, are often left picking up the pieces, dealing with tenants who never should’ve been approved in the first place.
Here’s where the real kicker comes in: Cities with high rental fraud also tend to have low eviction rates. Coincidence? Not at all. This pattern highlights the importance of verifying tenant identities before handing over the keys. That’s where property managers play the role of gatekeepers. According to Overland Properties, property managers have the tools (and the instincts) to spot red flags before a scammer sets up shop in your rental.
Adding roadblocks, like knowledge-based authentication (KBA), has helped weed out some fraudsters. But let’s be honest,most rental companies aren’t tech-savvy when it comes to fraud prevention. Instead, they rely on old-school techniques, like calling employers and requesting W-2s. That can feel invasive to legitimate renters, and even then, fraudsters are often two steps ahead. Meanwhile, property managers are left trying to balance fraud prevention with fair housing compliance, a tricky tightrope to walk.
The reality is that property managers aren’t private investigators. They don’t want to play detective; they just want reliable tenants who pay on time and don’t cause trouble. The challenges they face in fraud prevention include:
- Complicated training processes (who has time for a 20-step fraud detection manual?)
- The fear of being accused of discrimination if screening isn’t perfectly uniform
- The headache of using multiple verification tools that don’t seamlessly work together
Some managers are turning to identity verification software or requiring bank login services like Plaid. But there’s no one-size-fits-all solution. Many end up piecing together different systems, hoping they catch the fraudsters before they slip through the cracks.
So, what would an ideal fraud prevention system look like for property managers? It needs to:
- Actually work (obviously!)
- Fit seamlessly into their existing leasing process
- Handle support calls so managers aren’t bogged down with tech issues
- Comply with fair housing laws to avoid legal nightmares
- Be easy for renters to use, no unnecessary hoops to jump through
That’s why companies are developing streamlined fraud prevention solutions, aiming to bring security and trust to the rental industry. One such tool allows property managers to verify applicants with a single link, no need for back-and-forth emails or multiple logins. It scans IDs, ensures the applicant in front of the camera matches the ID, and runs the data through an advanced fraud detection system. If everything checks out, the applicant signs a form to confirm their identity.
At the end of the process, property managers receive a comprehensive identity report with all verification details. And if an applicant can’t verify online, they’re instantly connected to a live notary who can authenticate them in real-time. No delays, no excuses,just a smooth and fair process for everyone. If you need more information about the topic, check out this website.
For property managers, the battle against rental scams and title fraud doesn’t have to be a losing one. With the right verification system in place, they can focus on what they do best, keeping properties running smoothly and ensuring that the only people getting the keys are the ones who actually belong there.
