This article discusses tenant screening processes with a view to uncovering fraud. It is not meant to be a thorough discussion of tenant screening per se. (This article continues the discussion of tenant screening presented in the last issue of WAM.)

Part 2 of 2 —
Investigating an Application

After reviewing an application with an applicant ensuring that it is completely filled out and readable, you can begin the investigation process. It should include 1.1) Checking the Driver License, 1.2) Checking the Social Security Card, 2) Employment Verification, 3) Residence Verification, 4) Banking Verification, 5) Running Credit Reports, 6) Running Eviction Reports, 7) Running Criminal Reports and 8) Checking References.

1.1) Checking The Driver License:
The first verification process is started by asking to see a driver license or picture ID card.

Check the driver license carefully. Does it appear to be a proper document or does it look suspicious? Ask the DMV for a brochure on valid driver licenses and keep it handy for making comparisons.

Check the picture. Is it of the applicant? Check the signature. Is it the same as on the signature line of the application? Check the D/L number, name, address and birth date. Are they the same as given in the application?

Ask the applicant about any discrepancies and make notes of his/her responses. These answers may contain reason to reject the applicant.

1.2) Checking the Social Security Card:
Ask to see the applicant’s social security card.

Verify that the SS# on the card is the same as given on the application. Compare the place of origin with where the applicant says he/she is from. SS numbers are issued by locality. Get a free listing from the SS Administration.

Check the card carefully. Does it appear to be a proper document or does it look suspicious? NOTE: check the signature line with a magnifying glass. It should not be a line. Look at your own and see what it should be.

2) Employment Verification:
First, require the applicant to produce several recent pay stubs and in addition, a current paycheck and stub Verify the paycheck amount with the earnings claim, by the applicant on the application. Compare each pay stub with the others to verify the YTD earnings and deductions are consistent. Many times the pay stubs contain the SS#. Verify it is the same as on the card and on the application. Many times the checks and stubs contain the employer’s phone number. Use this numb for telephone verification.

The second method of verifying employment is calling the employer. Try not to use the number supplied by the applicant because it may be a friend’s number. Get the employer’s phone number from the telephone book or information. Is it the same as was given by the applicant?

Try to speak with someone who is as far from the applicant as possible, that is, not a co-employee or immediate supervisor. Go for a personnel or payroll department. Someone too close to the applicant may have already arranged for a false story to tell you. Be c your guard.

3) Residence Verification:
First, current residence may have already bee somewhat verified if the driver license had the same address as the current address. However, ask the applicant to bring in several recent utility bills. Examine them to be sure the utilities are paid on time, they are in the name of the applicant and at the address claimed as the current address.

Second, call the current landlord, but like the employ¬ment verification, get the phone number from the phone book or information to avoid a trap of speaking to a friend instead of a landlord. Ask specific questions, such as: When did tenancy start? How much rent is being paid? How many persons in the applicant’s unit? Any pets? Any complaints from neighbors? Any notices for rent or nuisance served? Has notice of moving been given? Etc. Compare the answers with the information on the application.

Because there may be a motivation for a present land¬lord to lie to you in order to get rid of a bad tenant, be sure to verify prior landlords as well. If they remember your applicant, you will get a more truthful report from them. If they do not remember your applicant, that may be a good sign because landlords never forget their problem tenants.

4) Banking Verification
You can not get information from banks the way you used to. Now, there are automated computers that talk to you, but you must know the phone numbers to call. Sure enough, if you have a phone number to call, the application should contain whatever information you need to find out the current status, but without someone to talk to there is a lot of information you will not get.

Ask your applicant to provide you with a few of his/her recent monthly banking statements. From this you can again verify address, the bank account being in the name of the applicant, the beginning and ending balances, the deposits which will all go to show you the “cash flow” to match up with claimed earnings. They will also show any NSF activity.

5) Running Eviction Reports
Now that the free stuff is done, it is time to contact a tenant-screening agency (TSA) to gather information from its database.

By using a competent TSA you should be able to find out if there are present or prior eviction cases, or other property related cases, filed against your applicant, or if a prior landlord has reported any derogatory infor¬mation. Be certain the TSA gets cases as they are filed and not just cases that have judgments. This is the distinction that separates the professional and competent TSA from a dabbler.

It has been shown time and time again that if a person has been evicted before, it will happen again. Don’t let the next victim be you.

6) Running a Credit Report
Your TSA should be able to provide you with a credit report issued by a major, national, credit reporting bureau. This credit report should be ordered with the eviction report because it is usually cheaper to do so. Do not rely on a report supplied by the applicant; it may be doctored.

The credit report will tell you if your applicant can afford to pay his/her debts and if he/she is also so inclined to pay his/her debts.

Verification of address can also be made from the credit report, but it should not be relied upon as the sole verification. If address information or other identity information comes back on the credit report different than stated on the application, you are obligated to view and verify additional identification documents before accepting the applicant or extending credit to the applicant. There are proposed laws pending in the legislature right now that will impose heavy fines if you fail to make this additional identification verification.

Be certain you know your obligations when using credit reports. Refer to and get to know the Federal Fair Credit Reporting Act (FCRA) which can be found at www.ftc.gov.

7) Running Criminal Reports:
It is a good thing to run criminal reports before renting to an applicant and the crime-free program recommends doing so. However, in California, it is not easy to come by this information and if you can get it, it is not cheap and will take more time than the applicant will be willing to wait.

If at all possible, run the criminal records report because you owe it to your present community of renters to protect them from harm. To take in a serial rapist or burglar who later victimizes your other tenants can be viewed as “negligent renting” for which you can be held liable. Therefore, even if the report has to be run with the result being reported after you have rented to such an applicant, you can protect yourself and your other tenants by starting eviction proceedings after receiving the report.

8) Checking References:
It is not likely that an applicant will list a person as a reference who will say bad things about him/her. But call these references anyway to verify they exist. They may be useful later on when you are trying to skip¬trace the applicant to collect a debt.

Harvey Saltz is an attorney at law, a real estate broker and the President of The UD. Registry, Inc., a tenant screening agency. For questions, contact Mr. Saltz at 1(800)464-1007 ext. 7200#.