The True Impacts of Rental Application Fraud & How Technology Can Help

The uptick in renter fraud is an extremely concerning trend in multifamily today. In our digital world, sophisticated techniques exploit vulnerabilities in property management companies and threaten the integrity of a community with false documentation, impersonation of legitimate residents and manipulation of financial transactions. In fact, the following statistic from the industry’s largest fraud study should sound alarm bells: 73% of participants reported that 59% of renter fraud is detected after move-in.– 2024 National Multifamily Fraud Research Study This means that fraud is not being caught early in the rental application process. The application records the personal details of prospects, like identity and income, to see if they qualify for an apartment lease and the associated responsibilities. Unfortunately, fraud is difficult to detect because it works quietly behind the scenes as fraudsters engage in pre-move-in tactics like stolen or synthetic identity, fake renter history, fabricated employment documentation and falsified income verification. In many ways, these hidden threats can jeopardize the experience of residents and onsite leasing teams and the financial stability of properties. The impacts of rental scams in multifamily When deceptive people move into your property because they outsmarted your prequalification leasing process, several things can happen: Dampened resident experiences Fraud can negatively affect the overall living experience in a community. It can cause distrust and suspicion among residents and eliminate the sense of cohesion and camaraderie essential for thriving resident experiences. As a result, you end up focusing resources on fraud-related issues, like legal fees and damage control, instead of on the amenities, services and infrastructure that keep residents happy. Compromised reputation 99.5% of participants reported that rental fraud has impacted their company in the last 12 months, with 51% experienc...