Rental fraud has been on the rise for a few years, primarily due to the increasing popularity of the internet. With more and more property transactions taking place online, fraudsters can attempt their scams with a degree of anonymity. But as the criminals get ever more innovative, so does the technology to stop them.
While there has been a rising number of hopeful tenants being scammed out of deposits by fraudsters pretending to be landlords offering properties online, legitimate landlords continue to worry about tenants refusing to pay the rent amount agreed upon in the tenancy agreement. Troublesome tenants who refuse to pay or are simply late with their payments have long been a problem sometimes encountered by landlords, but there is new technology to help with this problem too.
New developments help tenants avoid rental fraud
Online transactions are the simplest way to conduct business, with more and more proptech innovations making the buying, selling or renting of properties easier than ever. But the online nature of this business model also provides an opportunity for fraudsters.
Deposit protection schemeshave been around for a few years and are now a legal obligation in most cases. This means that no tenant should be fearful about losing their deposit when it is time to hand it over. Of course, fraudsters will still try and take advantage of the naïve or uneducated, but if tenants inform themselves as to the proper process and ensure they and their potential landlord abide by it then there should be no need for them to be fearful of being defrauded.
New tenants should abide by the following guidelines:
- Never send money up front without viewing a property in person. Fraudsters usually advertise properties that don’t exist or which they have no ownership claim over.
- Beware of advertised properties that have no pictures, or have the same pictures repeated for different property listings.
- Deposits should only be paid once a viewing has taken place and the contract has been signed.
- Be wary of any landlord who asks for a deposit to paid via wire transfer. You should be able to pay it directly into the deposit protection scheme.
New technology helps landlords avoid rental fraud
Landlords can also ease their concerns about late rent payments by using new technologies such as PayProp, which both landlords and their tenants use as an app to see when rental payments are due.
Once the rent has been paid into the agent’s client account, the PayProp tech can track the payment through the system until it arrives in the landlord’s own designated account. Such apps simplify the process and remove human error, and especially eliminate the possibility for the tenants to defraud the landlord out of the due rent.