Comprehensive data revealing the scope of rental fraud and why thorough tenant screening has become essential for property owners

Rental application fraud has reached unprecedented levels. In a 2023–2024 NMHC/NAA survey of 75 leading apartment owners, developers, and managers, 93.3% of respondents reported experiencing fraud in the prior 12 months. From falsified pay stubs to synthetic identities created by artificial intelligence, fraudulent applicants use increasingly sophisticated methods to deceive landlords and real estate investors. The financial consequences are severe: survey respondents reported an average of $4.2 million in total bad debt write-offs annually, with nearly one-quarter of that loss attributed directly to fraudulent applications. For landlords managing multiple properties, comprehensive tenant screening is no longer optional but rather a critical defense against applicants who misrepresent their financial qualifications.

Key takeaways

• Fraud is widespread among surveyed providers: 93.3% of respondents in the 2023–2024 NMHC/NAA survey experienced fraud in the prior 12 months, while 70.7% reported increasing fraud rates
• Income falsification dominates: 84.3% of surveyed housing providers have encountered falsified pay stubs, employment references, or other fabricated income documentation
• AI is accelerating fraud: Across Inscribe's network, detected AI-generated document fraud increased nearly fivefold between April and December 2025
• Fraud creates substantial financial losses: NMHC survey respondents reported nearly $4.2 million in average total bad debt write-offs over the prior 12 months, with 24.5% of bad debt attributed to nonpayment tied to fraudulent applications

Understanding the landscape of rental fraud: key statistics

The rental fraud problem has grown from an occasional nuisance to a systemic issue affecting nearly every property owner. Industry surveys reveal that fraud is not only widespread but also increasing at an alarming rate.

1. 93.3% of respondents in NMHC/NAA survey experienced fraud in the prior 12 months

The National Multifamily Housing Council Pulse Survey, conducted November 2023 through January 2024, found that over nine in ten respondents from 75 leading apartment owners, developers, and managers encountered some form of fraud in the preceding year. This widespread experience among major operators demonstrates that fraud prevention is essential for every landlord, regardless of portfolio size or market.

2. 70.7% of providers reported increasing fraud rates

Beyond the prevalence of fraud, the trend line is troubling. More than 70% of housing providers in the NMHC survey reported that fraudulent applications and payments increased compared to the previous year, indicating an accelerating problem rather than a stable threat.

3. 40.4% average increase among respondents reporting higher fraud

Among NMHC survey respondents who specifically reported an increase in fraudulent applications, the average year-over-year increase reached 40.4%. This growth rate outpaces most economic indicators and suggests that fraudsters are becoming more active and effective.

4. 6.4% of rental applications were fraudulent in 2024

Analysis of nearly 5 million documents by fraud-detection provider Snappt revealed that 6.4% of rental applications contained fraudulent elements, with over 80,000 documents manipulated. While this represents a slight decrease from 7.9% in 2023, the absolute volume of fraud attempts remains substantial.

Identifying red flags: statistics on common fraudulent tactics

Understanding how applicants commit fraud helps landlords recognize warning signs. The data reveals clear patterns in what fraudsters falsify most frequently.

5. 84.3% of providers have seen falsified income documentation

The most common fraud type involves fabricated pay stubs, employment references, or other income documentation. Nearly 85% of rental housing providers in the NMHC survey have encountered this tactic, making income verification a critical screening component. Baselane's tenant screening service includes optional income verification through bank and payroll data validation to help landlords detect fabricated financial documents.

6. 80% of providers observed application misrepresentation

Beyond income documents, 80% of housing providers in the NMHC survey reported prospective renters misrepresenting information directly on applications. This includes false employment history, fabricated rental references, and inaccurate personal details.

7. 70% reported identity theft or fraudulent ID documents

Identity-based fraud affects 70% of rental housing providers surveyed by NMHC, including identity theft, fraudulent ID documents, or use of another individual's personal information. This type of fraud is particularly damaging because it can mask an applicant's true credit and criminal history.

8. 67.1% experienced unauthorized cohabitants or illegal subletting

After lease signing, 67.1% of providers in the NMHC survey encountered unauthorized cohabitants, illegal subletting, or other actions designed to evade the application and leasing process. These post-move-in violations often trace back to initial application deception.

9. 62.9% reported fraudulent payment methods

Payment fraud, including fraudulent checks and other illegitimate payment methods, affected nearly 63% of providers in the NMHC survey. Secure rent collection through verified ACH transfers can reduce exposure to fraudulent payment methods.

The role of tenant screening in preventing application fraud

Comprehensive tenant screening can help landlords verify applicant information and identify inconsistencies before approving a lease. The data shows both the scale of the problem and the protective value of thorough verification.

10. 57% of surveyed multifamily professionals reported misrepresented income

A 2024 RealPage study of 402 multifamily professionals across five major markets found that 57% of respondents had encountered misrepresented income. This concentration makes income verification through direct employer contact or payroll data validation particularly valuable.

11. 58% of surveyed multifamily professionals reported fake or manipulated identities

In the same 2024 RealPage study, 58% of respondents reported encountering fake or manipulated identities during the rental application process. Baselane's tenant screening includes ID verification supporting 16,000+ ID types across 200+ countries with database checks, document scanning, and facial recognition.

12. 3.8% of applicants evaluated by Snappt in H1 2026 contained fraud

In the first half of 2026, Snappt evaluated more than 700,000 rental applicants and found that 3.8%, or roughly 1 in 26, contained fraud. The company notes that fraud rates vary substantially by market.

13. 92% of surveyed renters support more technology to prevent fraudulent listings

In a 2024 survey of 500 U.S. renters, 92% said it was important or very important for landlords and property management companies to use more technology to prevent fraudulent listings. This bidirectional verification protects both parties in rental transactions.

Financial impact of rental application fraud

The costs of accepting a fraudulent tenant extend far beyond unpaid rent. Understanding the complete financial picture helps justify investment in thorough screening.

14. $4.2 million in average total bad debt write-offs reported by NMHC survey respondents

In NMHC's 2023–2024 survey, respondents reported writing off an average of nearly $4.2 million in total bad debt over the prior 12 months. Separately, respondents estimated that 24.5% of their bad debt, on average, resulted from nonpayment tied to fraudulent applications. While this figure reflects larger portfolio operators, it demonstrates the substantial capital at risk from non-paying tenants.

15. 24.5% of bad debt attributed to fraudulent applications

Of total bad debt in the NMHC survey, an average of 24.5% could be attributed directly to nonpayment of rent by tenants who submitted fraudulent applications. This connection between fraud and eventual nonpayment underscores why screening prevents financial losses.

16. 23.8% of eviction filings stem from fraud-related nonpayment

Nearly one-quarter of eviction filings in the NMHC survey were due to fraudulent applications and subsequent failure to pay rent. Each eviction carries legal costs, lost rent, and vacancy periods that compound the initial fraud damage.

17. $65 million in reported rental scam losses to the FTC

Between 2020 and June 2025, the Federal Trade Commission received nearly 65,000 reports of rental scams totaling $65 million in losses. This figure likely represents only a fraction of actual losses, as many victims do not file formal complaints.

18. $1,000 median reported loss per rental scam victim

The median reported loss for rental scam victims reached $1,000, representing a substantial financial blow for individuals seeking housing. For landlords, this figure reflects the amounts fraudsters successfully extract before detection.

The rise of AI-powered fraud

Artificial intelligence has transformed the fraud landscape, enabling sophisticated document manipulation that traditional detection methods struggle to identify.

19. AI-generated document fraud increased nearly fivefold between April and December 2025

Across Inscribe's network, detected AI-generated document fraud increased nearly fivefold between April and December 2025. This exponential growth in AI-assisted fraud means that visual inspection of pay stubs and bank statements is no longer reliable.

Protecting your rental business from application fraud

Baselane, a banking and bookkeeping platform for multi-property real estate investors and operators, offers tenant screening with a rental application, ID verification, and full Equifax credit report, with criminal, eviction, and income-verification reports available as applicant-paid add-ons:

• Credit reports through Equifax to verify financial history and identify discrepancies
• Criminal background checks accessing 1.8 billion records across 2,500+ jurisdictions
• Eviction history from the largest U.S. housing court database
• Income verification (applicant-paid add-on) through bank and payroll data validation to detect fabricated pay stubs
• ID verification supporting 16,000+ ID types with document scanning and facial recognition

For landlords managing multiple properties, Baselane combines screening with banking and bookkeeping tools where transactions are automatically assigned to each property, entity, and tax category, making it easier to track fraud-related expenses and maintain accurate financial records.