How to Catch a Rental Scammer: 5 Tips for Landlords

There’s no denying that scams exist in the rental market. There are countless horror stories of renters falling victim to con artists posing as legitimate landlords. In some places, it seems the problem is only getting worse. 

Why? Young professionals, who make up a large portion of renters, are under particular financial strain. According to Equifax Canada, millennials and Gen Z saw their average non-mortgage debt rise by 2% in Q2 of 2025 compared to the year before. Nearly 1 in 4 renters is under the age of 34. While a single-digit increase may not seem like much, job uncertainty or even unemployment increases financial vulnerability, leading some people to do whatever it takes to secure a rental.

According to recent SingleKey rental application data, the average Canadian tenant spends 37% of their income on rent, above the recommended 30% threshold. Tenants are paying even more in major cities, from Vancouver at 37.46%, to Calgary at 39.76%, to Toronto in rent to income crisis territory at 41.12%. 

Unfortunately, landlords are often the target as budgets tighten and some renters turn to scams and fraud to slip by and secure a home. 

If you don’t know how to spot a rental scam, you could wind up with a tenant who brings you nothing but trouble and financial hardship. In this guide, we’ll examine five common rental scams that impact landlords and provide tips for avoiding them.

1. Fake credit reports

Reviewing a potential tenant’s credit report is a great way to determine if they can afford your rent. However, not every report you come across is genuine—some could be complete fakes.

The scam works like this: A tenant offers to provide a copy of their credit report personally, insisting it will save you time and money. However, instead of obtaining the document from a legitimate credit reporting agency, such as Equifax or TransUnion, they create one from scratch. 

Creating a phony credit report isn’t that difficult. Sometimes, all it takes is finding images of a sample credit report online and assembling them into a fake report using basic software, such as Google Docs and Acrobat DC.

How to protect yourself

Knowing the telltale signs of a fake credit report can help you avoid being conned by a dishonest tenant. While identifying a forgery can be challenging, most contain glaring inconsistencies and errors that make them stand out such as fuzzy logos, inconsistent spacing, and fake credit score calculation branding. Learn more about how to spot phony credit reports.

However, despite your best efforts, it’s still possible to mistake a fake report for one that’s authentic. That’s why you should never accept a credit history directly from a tenant. Instead, obtain the credit details you need from a third-party source, such as SingleKey’s Tenant Report. That way, you can rest assured that the information you’re looking at is accurate, reliable, and up-to-date.

2. False employment history

Tenants may exaggerate or misrepresent their employment situation to improve their chances of getting approved for a lease. For example, they may lie about their employment history on their application, misleading you into thinking they have a steady job when they don’t. They may even overstate their earnings or have a friend pose as their employer so they can provide you with a fake employment reference.

How to protect yourself

The only way to determine if an applicant is honest about their employment situation is to verify that they indeed hold the job they claim to have. Here’s how to do that.

Step 1: Obtain consent from the applicant to confirm their employment history. On your rental application, disclose that by signing the document, the tenant consents to an employment background check. You can also mention this fact to the tenant during your pre-screening interview. 

Step 2: Ask for proof of earnings. Request that the tenant provide you with a copy of a few months’ pay stubs. That way, you can cross reference and verify if their monthly earnings match what they’ve listed on their rental application, and across all documents.

Step 3: Find the employer’s contact details. Search online (company website, Linkedin business page and reference’s profiles, etc) to find the tenant’s employer and obtain their phone number and email address. When you do this, look for common signs of fake references: the business page has sufficient employees listed under it, and the reference’s profile photo is legitimate and not an AI rendering.

Step 4: Contact the employer to verify the tenant’s employment status. Reach out to the tenant’s employer to confirm the details provided by the tenant on their rental application, such as their start date at the company and monthly earnings.

3. Missed rent payments or over-payment scams

When you are a landlord, rent is not just income. It is what covers your mortgage, property taxes, insurance, utilities, and repairs. Even one missed payment can put pressure on your cash flow, especially if you are renewing at a higher interest rate.

Missed payments usually start with a warning sign. A tenant may say payroll was delayed, they are switching banks, or they will “send it tomorrow.” Occasional delays can happen. But repeated excuses, partial payments without explanation, or sudden communication gaps are early indicators that a larger issue may be developing.

Beyond late rent, some risks are intentional.

Overpayment scams are becoming more common. Here is how they typically work:

• A tenant sends a cheque or transfer for more than the rent owed.
  
• They quickly claim it was a mistake.
  
• They ask you to refund the “extra” amount immediately

Days later, the original payment bounces or is reversed. If you already sent the refund, you are left covering the full loss.

Another tactic involves fraudulent eTransfer requests. Instead of sending rent, a scammer sends a money request that looks similar to a deposit notification. If you accept it without reading carefully, funds leave your account instead of coming in.

Red flags to watch for:

• Pressure to act quickly or refund immediately
  
• Inconsistent banking details
  
• Screenshots of payments instead of confirmed deposits
  
• Requests to move conversations off standard communication channels

How to protect yourself

1. Verify funds before refunding anything

Never return an overpayment until the original funds have fully cleared your account. A screenshot or confirmation email is not proof. Wait for the payment to settle, and confirm directly with your bank if needed.

2. Read every eTransfer notification carefully

A money request and a money deposit can look similar at a glance. Before clicking anything, confirm that you are receiving funds, not sending them. Enable auto-deposit so legitimate rent payments go directly into your account without needing to accept them manually.

3. Use secure, consistent payment methods

Avoid switching payment methods mid-lease unless absolutely necessary. Sudden changes in banking details can be a red flag. Set clear expectations in the lease about how rent must be paid and stick to it.

4. Document everything

Keep written records of payment dates, amounts, and tenant communication. If a tenant begins making partial payments or repeatedly asks for extensions, address it early and in writing.

5. Screen thoroughly before handing over keys

Prevention starts at the application stage. Verify identity, check credit and eviction history, and watch for falsified documents. The stronger the screening process, the lower the likelihood of payment issues later.

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4. Illegal subletting of your rental property (both long and short-term leases)

There’s nothing wrong or illegal about a tenant subletting a rental unit to a third party. However, in most jurisdictions, they can legally do so only with the landlord’s permission.

Still, some tenants will ignore the law and sublet your property without your knowledge or consent. They will collect rent from the secondary occupant but never pay what they owe you under the main lease. Once you attempt to recover the past-due rent, the original tenant disappears. Or, they may have left a long time ago.

Besides the possibility of lost rent, illegal subletting increases the risk of property damage and legal disputes since you never screened the subtenant. Evicting them can also be messy and tedious, depending on your region’s squatting regulations. For example, in New York, an individual who occupies a property assumes the status of a legal tenant after only 30 days.

How to protect yourself

If you prohibit subletting in your rental agreement, include a clause in the lease that forbids the practice. Inform your tenant that violating the policy can result in the termination of the lease.

Alternatively, state that subletting is allowed only with your explicit permission. That way, you have more control over who can stay in your rental and for how long. When creating your subletting policy, consider the following:

• Who is responsible for screening subtenants? You or your tenant?
• Will approval be granted on a case-by-case basis, or will there be strict criteria that every applicant must meet?
• What are the rules for overnight visitors?

You can also create an alert to receive emails when your rental property’s address appears in Google Search results. If it does, it could be that your tenant is advertising your rental for subletting. Alternatively, services like SubletAlert notify you when a tenant sublets your property on Airbnb and similar platforms.

Regular inspections are another effective way to prevent or detect illegal subletting in your rental property. You can even do surprise visits, provided you give your tenant proper notice before entering.

5. Rent dodging

Landlords cite non-payment of rent or late rent payments as one of their greatest fears in managing a rental property. Usually, this occurs because the tenant experiences a financial setback that causes them to fall behind on rent, such as job loss, severe illness, or divorce. However, some enter into a lease intending never to pay rent, even if they have the financial means.

Rent dodging scams are difficult to foresee, as the tenant initially appears cooperative, reliable, and trustworthy. They may pay the first month’s rent and security deposit without trouble and have no history of prior evictions. However, after moving it, they abruptly stop sending money on the 1st of the month. When you realize the trouble that you’re in, you may already be out several months of rent and mounting expenses.

How to protect yourself

A rigorous tenant screening process is the first line of defense against a rent-dodging scam. However, it’s not an airtight solution, as there’s no way to predict how a tenant will behave in the future. If your tenant suddenly stops paying rent, don’t procrastinate. Take action now, or you’ll find yourself with thousands or tens of thousands of dollars in past-due rent.

To protect yourself, consider enrolling in a program like SingleKey’s Rent Guarantee, which offers financial compensation for lost rent if your tenant stops paying. You’ll have peace of mind knowing you have a backup plan to help you stay afloat while searching for a replacement tenant.

What to do if you’ve been scammed

If you’ve fallen victim to a rental scammer, take action immediately. The sooner you do, the more likely the fraudster will get caught and charged. Here’s what you can do if you suspect fraud has taken place:

Contact local authorities. Get in touch with law enforcement in the community where your rental is located. Provided there’s sufficient evidence, the police will launch an investigation to find the culprit. If successful, you may be able to recover the money you lost due to the scam.

Contact the rental listing website. If a fraudster has created a fake ad using your listing, send a request to the rental platform to take it down.

Report to the Canadian Anti-Fraud Centre (CAFC). The CAFC is a Canadian government agency responsible for gathering information and complaints about illegal and unethical business practices. You can report the scam on the organization’s website or by calling their phone number.

Report to the Federal Trade Commission (FTC). The FTC is a U.S. federal agency that protects consumers from illegal, deceptive, and unfair business practices. You can report the incident on the FTC’s website at reportfraud.ftc.gov.

Report to Openroom. Openroom is an online platform that collects court orders, tribunal decisions, and crowdsourced information related to disputes between landlords and tenants. Adding your case will help other landlords make informed decisions about renters before signing a lease agreement.

File a complaint through the Internet Crime Complaint Center (IC3). The IC3 is a government agency that assists local authorities and the FBI in solving online crimes.

Our final thoughts

Rental scams are an unfortunate reality in the rental industry. If you’ve been in this business long enough, you can expect to encounter them sooner or later. Unfortunately, you can’t predict with 100% accuracy how a tenant will behave once they move in, which can be frustrating and demoralizing. However, understanding how rental scams operate and applying the right tools and techniques to combat them can help you avoid becoming a victim.

To learn more about protecting yourself as a landlord from rental scams, check out our webinar on fraud prevention.