In the apartment leasing process, landlords require applicants to provide proof of identity, employment and income before granting approval. Traditionally, those would be printed and either mailed to a leasing office or handed over in person.
Since the pandemic, more apartment leasing is done online, with renters signing for apartments without even visiting the building. But as online leasing platforms have proliferated, so have scams designed to take advantage of them, industry experts said.
Reported internet-based real estate crimes have risen from $213M in 2020 to $350M in 2021 to $397M last year, according to the FBI’s internet crime reports.
Those crimes include renter fraud, as well as other forms of real estate scams. An FBI spokesperson said the bureau doesn’t investigate these types of crimes, and landlords have expressed frustration that state and local law enforcement officials have been slow or unwilling to respond to the rise in fraud.
The surge in this type of crime has come as apartment operators have pushed the leasing process to online platforms, meaning renters rarely come face-to-face with a property manager, making it easier to pass off fake IDs. In 2022, 23% of renters took zero in-person tours before signing a lease, 69% submitted their applications online and 36% signed their lease electronically, according to Zillow.
“With the advancements of online document-editing technology, it means that really, anybody can do it,” said Daniel Berlind, the CEO of multifamily application verification service Snappt. “If you think about the process and the technologies available to fraudsters five and 10 years ago, manipulating a bank statement, a pay stub … really any financial document would have required a pretty high level of skill.”
Prospective renters use documents such as doctored W2s, faked employment verifications and fake or stolen identities to skirt the screening process and get approval. Renters who submit fraudulent documents during the rental applications are seven times more likely to end up in eviction proceedings, Berlind said.
While widespread, the practice is especially common in a handful of major metropolitan areas, such as Atlanta, Houston, Charlotte, Los Angeles and suburban Dallas, Berlind said.
A New York comedian went viral earlier this year with a clip explaining how she used Adobe Photoshop to alter her pay stubs and bank statements to afford to rent an apartment on her own. She later backtracked those comments and said, “To be clear, I was joking,” the Daily Dot reported.
But the social media landscape is rife with people who aren’t joking about how to commit application fraud.
Pages like Fresh Documents and Hart2Hart Entertainment, Kivysaptapprovals on TikTok, CyberCredible on X, and the ApartmentHacks subreddit — which now threatens to ban any members that talk about faking pay stubs — all offer suggestions and products to create new financial forms and other information for customers to get around a credit check, according to Snappt, which helps landlords identify fraudulent applicants.
“There are entire online communities that collaborate to discuss fraud,” said Berlind, who runs Snappt as well as his own real estate firm, Berlind Properties. “There are videos on TikTok that have millions of views, showing how to edit documents. There are entire forums on Reddit that discuss properties and lease-up, what their concessions are and literally give walkthrough guidance to would-be fraudulent applicants and how they can circumvent the process.”
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