When you’re a landlord, you want to avoid rental scams or you could end up struggling to profit from your properties. There are plenty of rental scams out there and you need to be aware of them. Let’s look at some of the common scams and how you can protect yourself as a landlord.
Common Rental Scams
While it might not seem like you can get scammed as a landlord, you can. Scammers may try to get you to send them money for many different reasons. Many of the scams targeting landlords are pulled off online.
One of the most common scams is the overpay scam. A tenant will ask to send you a check for more than the deposit and they will want you to wire-transfer the difference. Likely, the check or money order they are using will be fake. Anytime a tenant asks the landlord to send money through a money transfer, it’s likely a scam.
Another time you might be getting scammed is if a tenant wants to skip a part of the screening process. Maybe they don’t want a background check done or a credit check. Don’t skip any part of the screening process or you could get scammed.
You can also get scammed by your tenants when they don’t tell you who will be living on the property. They might be the only ones on the lease, but they have three other people living there. It’s also possible the person on the lease isn’t even living there.
Also, be aware of fake credit reports and background check reports. You should run these checks yourself and not trust potential tenants to bring them to you on their own.
Tenants can also pay for fake references and employer letters. Be very careful with this and always check references and call the employer to ensure a tenant is employed.
How to Protect Yourself from Rental Scams
1. Have a Strong Lease Agreement
The lease agreement can help protect you from rental scams. Good tenants won’t be worried about a strong lease agreement. However, tenants that want to scam you, will not want to sign a lease agreement that protects you properly.
2. Have a Strong Screening Process
It’s not enough to have tenants fill out an application. Make sure you get a credit check and a background check, at least. It’s best to go further and call their employer to verify employment and income. You can also call the references they provide to ensure they are real references.
3. Hire a Property Management Team
With a good property management company, you will gain even better protection. They will have a strong lease agreement and a good screening process already in place. Plus, some property management companies will do regular property inspections and make sure your rental properties have good tenants living in them.
If you want to avoid rental scams as a landlord, you should be aware of the possible scams. With a good property management company, you won’t have to worry nearly as much.