Landlords file over 3.6 million evictions in a typical year. The better a landlord is at detecting and uncovering lies on the application, the more successful the landlord will be at avoiding a costly eviction and property vacancy.
What Information Needs to Be Verified on a Rental Application?
To verify all of a tenant’s information, a landlord must perform a variety of checks and gather reports. This could include using tenant screening services, talking to previous landlords, talking to employers, checking with personal references, asking for ID, and more.
Here’s what most landlords ask for:
- Personal Information (name, phone, current address, date of birth, etc.)
- Social security number (SSN) for pulling credit history, criminal background, and eviction history (SSN is not required in most cases nowadays to pull these reports, but it’s a helpful check on their identity as they’re nearly impossible to fake.)
- Income
- Debts (to calculate debt-to-income ratio, or DTI)
- Employment
- Credit, criminal, and eviction history
- Rental history (missed or late payments, history of property damage, etc.)
- If they smoke
- If they have pets
- Vehicle information
Landlords need to verify all of this information.
Low-quality tenants lead to more vacancies and evictions. With the average rent in the U.S. is just over $2,000 per month, this is an expensive bill for a property owner to cover if a tenant doesn’t pay or vacates the property early. Finding a good tenant and keeping them in the property is essential to your success as a landlord.
Many landlords will use most, if not all, of that information provided to screen tenants and choose the best applicant. If a landlord detects any lies on the application, that will be an automatic rejection in most cases.
How to Verify Personal Information
The first step in tenant screening is to verify that the applicant is the right person. An unqualified tenant may try to pass off as someone else to be chosen for the lease.
Here are a few ways to verify their personal information:
- Driver’s license – This is usually the most common as it will have their name, address (possibly not up to date), and date of birth on it.
- Physical utility bill (hard copy) – This can be used to match a name with an address.
- Passport
- International or travel visa
Verifying a phone number is less important as any serious candidate will have no incentive to provide a fake one. They want you to call them, after all.
How to Verify Financial Information
Landlords need to look into the applicant’s financial information including:
- Income
- Employment
- Debt-to-Income Ratio
Verify Income
There are a few ways that landlords do this. The most common are usually:
- Call the employer – Asking the right questions to either the applicant’s boss or an HR rep at the company can give you everything you need about how much they make.
- Ask for W-2 or pay stubs – Either way, these are surefire ways to corroborate the income figure that the applicant supplied.
Verify Employment
The simplest way is that when the landlord calls about income to also ask about their employment there. However, a thorough landlord will also call previous employers to help establish a history.
Here’s what a landlord should look to verify when talking to previous employers:
- That what was listed on the application is true
- The applicant doesn’t have a history of being disciplined or fired
- That there aren’t any big gaps in employment
- That the applicant doesn’t jump between fields. This shows a lack of a true career, often meaning less security and income potential. This may seem like a bit of a nitpick, but if a landlord is in the enviable position of picking between multiple qualified applicants, this could be a deciding factor.
Verify Debt-to-Income Ratio
DTI may be a more critical factor than income for most landlords.
Let’s say there are two applicants. Applicant A makes $100k per year but has $3k per month in debt payments. Applicant B makes $80k per year and has no debt payments.
Not only does Applicant B have more net pay after debts are paid, but they also show better financial judgment, in most cases. Applicant A may have had emergencies that have no bearing on their typical financial activity, but they have less net income.
Debt-to-income is most easily verified on a credit report, which will list creditors and the size of debts. Divide debt by the income to get the ratio (e.g. for applicant A, $36k/$100k = 36% DTI, without even a rent payment included).
Most landlords default to using the rent-to-income ratio to calculate an applicant’s ability to pay the rent because it’s simple. This is a flawed calculation, and landlords should always consider the applicant’s monthly debt obligations in addition to income.
How to Verify Credit History, Criminal Background, and Eviction History
The most common way to pull this information is through a tenant screening service. They vary in cost from $15 to $50 based on how thorough the service is. It is well worth the cost to have accurate information for each qualified applicant.
In most states, landlords can charge an application fee that will cover tenant screening costs. While the landlord could decide to pocket application fees instead of hiring a tenant screening service, in the long run, this will almost certainly be a poor financial decision.
There are other ways to pull credit, criminal, and eviction history (for free, even), but it requires much more work and will almost always result in less thorough reports than if a professional tenant screening service did it for you.
Some states cap the application fee, while others ban it entirely. This may tempt landlords to skimp on paying for tenant screening services, but the long-term risks of avoiding proper screening are too high to ignore.
How to Verify Rental History
Rental history usually includes information such as:
- Dates and addresses of prior rental properties
- Late or missed payments
- History of property damages
- History of vacating without notice
This one requires a little more work as most of this information can’t be pulled in reports, and previous landlords are often not as easy to work with as an employer.
Reports will only show late or missed payments. However, late payments can only be reported if they are more than 30 days late, meaning if the tenant consistently pays 2 to 3 weeks late, you won’t find that in a credit report. You also won’t know if they paid in installments, or tried to beg or barter with their rent.
In general, a landlord will need to speak to prior landlords to get the proper information. Here are a few questions landlords should ask to verify information about rental history:
- When did they rent from you?
- Did they ever pay rent late or in installments?
- Did they take good care of the property?
- Was the property in good condition when they left?
- Did they break any rules of your lease agreement?
- Were they respectful and helpful with their communication?
- Did they smoke in or near the rental unit?
- Did they receive their security deposit back?
- Did they give you notice before vacating?
- Why did they move out?
How to Verify No Smoking and No Pets
One way to verify this information would be to talk to their personal references. Hopefully, they’ve included people who would know these sorts of details (for example, a community leader they work with once a week may not know if they have a dog).
Landlords can also do a little digging to see if they can find the applicant’s social media pages (Instagram, TikTok, or Facebook). If an applicant consistently has a dog on their profile or can be seen smoking, it’s safe to assume they were being untruthful.
You may also have to rely on your gut feeling up front and take their word for it. If they are fully qualified everywhere else, and they have great communication skills, then a landlord can decide to trust their applicant.
Pets and smoking habits can be verified later when doing checks on the property.
How to Verify Vehicles
On the application, you should ask for the make, model, and license plate number of any car they own. This way, you can know which cars are theirs at the property. Also, if there are any complaints or issues, you have a description of the cars.
There’s no good way to verify vehicles ahead of time, other than just asking on the application. A statement on the application limiting the number of vehicles can help deter applicants from being untruthful, but it’s no guarantee.
What Happens if a Tenant Lies on a Rental Application?
Intentionally lying on a rental application is illegal and considered fraud. If you find and verify an intentional lie on the application, deny it immediately and move on to the next applicant.
However, you also need to keep in mind that people make mistakes. There is a chance the applicant made a mistake or believes the information they provided to be true.
A tenant reports a “good” credit score of 671 based on their last report. When you run their credit check, the report shows a “fair” score of 668. Credit scores are known to vary a bit by the credit reporting agency and if the applicant has applied to a few rental places, the hard inquiries may have affected their score.
You will need to use your best judgment to determine if the applicant intentionally lied or if it was a reasonable mistake. Regardless of their intention, if the applicants’ real information doesn’t meet your previously set criteria, move on.
If you discover the lie after a lease agreement has been signed, resolution can be a bit more difficult. You will need to consult with a lawyer and likely file an eviction.
