Rising tenant application fraud – landlords pay the price

Rising tenant application fraud – landlords pay the price

9:57 AM, 12th April 2024, About a month ago 5

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Was anyone else surprised/not surprised to read that tenant application fraud has rocketed by 140%? For those working at the sharp end of the private rented sector, I doubt it.

My first reaction was why something like this isn’t being highlighted in the dreadful Renters (Reform) Bill as an issue that landlords should not have to put up with.

This is, undoubtedly, an alarming trend that is emerging and it’s not just down to people committing fraud to carry out a criminal act, for example, starting a cannabis farm.

Instead, the crazy world of rising PRS demand means that tenants are taking extreme measures to get somewhere to live.

And the Renters (Reform) Bill has no intention of improving the lot of landlords so why would it mention the poor behaviour or antics of tenants?

Payslip fraud was the most common way to trick referencing

The analysis of more than 600,000 tenancy applications by Goodlord found that payslip fraud was the most common way for tenants to trick referencing systems.

I would think it’s relatively easy to create a fake payslip – how many people actually get a piece of paper with their pay on it?

In 2023 alone, payslip fraud accounted for 58% of all fraud cases detected.

But I was flabbergasted to read that a fake application that slips through could cost a landlord £10,000. £10,000? That’s the profit from years of renting out a home being wiped out.

All that hassle, late night tenant calls, tax, agent bills, repair bills, tax, over-regulation and you are left with nothing. Except a tax bill, obvs.

I know I keep harking on about landlording getting more difficult but that’s an outrageous amount of money to lose.

Rise in tenant fraud over the last year

Despite the overwhelming majority of applications being above board, the rise in tenant fraud over the last year highlights the need for robust safeguards against fraudulent tenant applications.

But no one seems to appreciate that tenants are very unpredictable. (Are you listening Generation Rent?).

It’s impossible to predict who will be a good tenant.

On paper, the tenant may look perfect financially at that moment, but a week later they could be made redundant or be fired, and there goes the financially sound tenant.

They could also be no good at cleanliness and excel at clumsiness, damaging the property while living in it.

On the other hand, you could get a tenant on benefits because their pay is low but have a reliable source of income to meet the rent payments on time and in full.

Turns out they are extremely houseproud and careful – an ideal tenant.

So, we should never judge a book by its cover.

Rising tide of tenancy fraud means being ultra-careful

But the rising tide of tenancy fraud means being ultra-careful because it’s easy to fake the documents that will get you what you need.

Landlords should never go by solely what it says on paper, human contact is far more telling.

I’ve always found that it’s much harder for people to lie or maintain a lie when meeting face to face.

On top of that, comprehensive referencing is a MUST for all landlords.

That way you are using a range of tools to ensure you get the best tenant.

Or the best tenant on paper until they trash your property.

The rise in tenant application fraud

Let’s face it, the rise in tenant application fraud is a growing concern for UK landlords.

With the potential financial impact reaching into the thousands, it’s clear that more needs to be done to protect landlords from this hidden cost.

As the rental market continues to evolve, so too must the measures put in place to safeguard those who provide the properties.

And, again, the human touch is key.

My grandmother would highlight whether someone would be good or bad by saying, ‘He’s a wrong ‘un’, and she proved to be quite accurate. Now, I’ve got an application here from a Ms Angela Rayner…..

Until next time,

The Landlord Crusader

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10:28 AM, 12th April 2024, About a month ago

My last 'new' tenant ended up costing me £20k+ by the time I managed to evict him. He passed my agent's referencing!

By the way, just check whether your new tenant will have any children living with her?


11:15 AM, 12th April 2024, About a month ago

This is one of the reasons we self manage our portfolio, Letting agents don't have skin in the game when when finding suitable tenants, if the tenant turns out to be a wrong "un" it's the Landlord who has to deal with the consequences.
We don't just really on referencing but rely on our 'gut feeling' when meeting the prospective tenant for the first time, must be doing something right as never had to take a tenant to court in the last 37 years.

Paddy O'Dawes

11:52 AM, 12th April 2024, About a month ago

Call me draconian but if there is fraud involved then there is no contract, in fact to some extent its obtaining by deception especially if the intent is to sit and not pay rent. There needs to be an ability to enact immediate termination under threat of criminal charges. Fundamental dishonesty should have no protection in any legal system it doesn't seem to have in any other area of the law apart from PRS

Reluctant Landlord

13:14 PM, 12th April 2024, About a month ago

all it should take is for LL to change the locks if they are 100% sure that a contract has been signed and tenancy obtained by fraudulent means.

Is the one that committed the fraud really going to launch a legal claim against illegal eviction if the only proof they have to rely on is the fraudulently obtained AST?


8:27 AM, 13th April 2024, About a month ago

The translation centres that you see popping up in every town and city are fraudulently filling in applications for tenancies and benefits and in my experience they even pretend to work in our office and provide fake tenancy agreements and proof of address letters etc etc etc.
The authorities have no interest in closing these centres so this fraud will only get worse.

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