Income verification, how do you spot the fake pay stubs ?

General Landlording & Rental Properties
9yFollow

Income verification, how do you spot the fake pay stubs ?

Kiet N.
Atlanta, GA · Member since 2016 · 91 posts · 67 votes

I ran across some ads on Craigslist regarding "novelty documents" service which provides pay stubs.

Have you seen any of these in from rental prospective applicants ? How do you spot them ? Thanks !!!

2Reply
216 views

Most Popular Reply

Terry Lao
Professional · Anaheim, CA · Member since 2017 · 1k+ posts · 686 votes
9y

@Kiet N.

I did mortgage banking for about 4 years. Yes, it happens on loans. Yes, people got to jail for mortgage fraud. It is a federal offense.

In above question, how do you spot? if person submits fake stubs, then ask them for their bank statement to see it hitting their bank. For example, person is paid $2000 paid via check or direct deposit. Then when it hits their bank, then it show as deposit line item.

Also, I would ask them for their bank statement to see cash reserves, and not tell them to confirm pay stub.

Terrence

9Reply
See this reply in the discussion

37 Replies

Jump to latestLatest
  • Nicole A.Pro Member
    Rental Property Investor · Baltimore County Maryland and Tampa Florida · Member since 2013 · 2k+ posts · 2k+ votes
    9y

    I have never personally seen this. I would guess if they're going to those lengths to lie to you, then there will be something on their record that you'll find and then simply reject their application.

    3Reply
  • Terry Lao
    Professional · Anaheim, CA · Member since 2017 · 1k+ posts · 686 votes
    9y

    @Kiet N.

    I did mortgage banking for about 4 years. Yes, it happens on loans. Yes, people got to jail for mortgage fraud. It is a federal offense.

    In above question, how do you spot? if person submits fake stubs, then ask them for their bank statement to see it hitting their bank. For example, person is paid $2000 paid via check or direct deposit. Then when it hits their bank, then it show as deposit line item.

    Also, I would ask them for their bank statement to see cash reserves, and not tell them to confirm pay stub.

    Terrence

    9Reply
  • Max T.
    Investor · Philadelphia, PA · Member since 2015 · 3k+ posts · 3k+ votes
    9y

    Contact their employer. Research the employer independently.

    4Reply
  • Terry Lao
    Professional · Anaheim, CA · Member since 2017 · 1k+ posts · 686 votes
    9y

    @Max T.

    By contacting their employer, especially HR, it is highly unlikely that you will get confirmation over the telephone. Usually it's something that its a written request to HR, and only HR can confirm your dates of employment. No pay amounts. No good or bad items in HR folder. In fact, based upon the company policy, might not even give any information.

    Terrence

    0Reply
  • Russ M.
    Investor · Brookfield, WI · Member since 2014 · 110 posts · 99 votes
    9y

    I agree with @Max T..  Verifying employment means more than checking pay stubs, contact the employer directly.  And also dont just use the "supervisor" they may list on their credit app, as this could be a friend lying for them.  Call the main number and speak with someone in HR.  A few minutes spent up front on things like this can save lots of headaches later down the road.

    1Reply
  • Johann Jells
    Rental Property Investor · Jersey City, NJ · Member since 2011 · 1k+ posts · 876 votes
    9y

    Its gonna get tougher, my last tenant was totally paperless payroll, his "stub" was an email.

    2Reply
  • Chris T.
    Investor · Downers Grove, IL · Member since 2015 · 1k+ posts · 955 votes
    9y

    It seems like more and more employers are using "the work number", in order to validate employment. Does it seem like the case for you guys?

    https://www.theworknumber.com/go/products/Employme...

    2Reply
  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    9y

    First, search the employer on the internet or in the phone book to ensure the tenant did not give you a fake phone number. Second, call the employer and verify employment. Third, thank me for the simple solution. ;)

    The DIY Landlord Book4.7248 Reviews
    WebsiteView Page
    5Reply
  • Kimberly H.
    Residential Real Estate Broker · Chicago Suburbs, IL · Member since 2013 · 1k+ posts · 594 votes
    9y

    @Chris T. Yes I run into that a lot around here in the Chicago suburbs. And it doesn't even work right. Last year I had a guy who I was trying to verify via theWorknumber and it didn't work, I called the company asking for HR and he was the HR guy!! He had to go into his HR system and fix something to get it to work. Had he not been the HR person who could fix it I doubt it would have gotten anywhere and I'm sure theworknumber wouldn't refund the $$. Plus TheWorknumber isn't free either and passing the cost on to the applicant is just another headache.

    But @Terry Lao has a good point about getting bank statements that can verify the pay. I'm surprised that didn't occur to me before! Unless of course if they got f@ke paystubs they know where to get f@ke bank statements...

    0Reply
  • Terry Lao
    Professional · Anaheim, CA · Member since 2017 · 1k+ posts · 686 votes
    9y

    @Kimberly H.

    Here's the beauty of asking for the paystubs first. Then a few days later, you ask for the bank statements to show proof of 2-3 months of reserves. When you get the paystubs, people do not think that far ahead to fake their bank statements too.

    I rented to tenants before, and if they are in the low end rents, they will not think that far ahead. The norm is for them to give their previous landlord, and it is probably fake and probably a friend to cover for them.

    If for higher end properties, they might catch on, but if they do not think like a mortgage banker, then they will not think one step ahead.

    Terrence

    3Reply
  • Sean Cassidy
    Investor · Brownville, ME · Member since 2017 · 83 posts · 35 votes
    9y

    You guys get bank statements from renters? Where I am I'd get laughed at for such a request.

    2Reply
  • Patti RobertsonBusiness Member
    Property Manager · Virginia Beach, VA · Member since 2016 · 2k+ posts · 2k+ votes
    9y

    Somehow I missed this thread 4 months ago!  I just had this happen. The applicant not only gave me fake paystubs, she appears to have totally made up the company.  I was to entertained I wrote a blog about it last weekend. Even after I wrote this, she still won't stop.  Her lies go on and one.  Apparently she thinks I'm stupid.  LOL!

    https://www.biggerpockets.com/blogs/9232/65113-applicants-lie-really-my-real-life-story-of-a-tenants-tall-tale

    757-472-2547
    4Reply
  • M Marie M.
    Rental Property Investor · Washington, DC · Member since 2015 · 278 posts · 156 votes
    9y

    I just discovered this in a Craigslist ad for Baltimore Maryland under "Real Estate Services" I'll just copy paste what they have:

    Pay Stubs - 1 for $35. 2 for $60. 3 or more $25 each
    Landlord verification - Faxed $25. Verbal $30. Written $40
    Employment offer letter - $25

    Pay stubs custom. Employer can be given or provided. All stubs are printed on Standard paper, can use higher quality paper upon request and small fee.

    - You can pick it up in Baltimore city or West Baltimore county
    - We deliver Baltimore City or West Baltimore County
    - We can email PDF and you print
    - We can mail ( you pay standard postage)

    Is this legal?

    0Reply
  • Matt K.
    Walnut Creek, CA · Member since 2015 · 3k+ posts · 2k+ votes
    9y

    The items themselves might not be illegal, but the person that uses them will be committing fraud.

    But be a critical thinker for a second, if you can't fake your own paystub chances are you can't fake your own own bank account. The other two, I mean it'd take 5 min to do yourself... 

    The bigger the lie, the more chances you have for something to not add up. Like when the guy with an offer letter of a good job, pay stubs of decent salary.....mysteriously can't show you a bank account because he gets paid in cash.

    1Reply
  • Chris MasonPro Member
    Moderator
    Lender · CA · Member since 2015 · 9k+ posts · 10k+ votes
    9y

    If you want to get suspicious/paranoid, you can order tax transcripts and treat everyone the way the mortgage industry treats the self employed... use the lesser of what the YTD shows, or two years of tax returns, or most recent year of tax returns, says. Whichever of those three is the lowest, use that. 

    2Reply
  • Bettina F.
    Investor · Post Falls, ID · Member since 2016 · 606 posts · 699 votes
    9y
    Originally posted by @Johann Jells:

    Its gonna get tougher, my last tenant was totally paperless payroll, his "stub" was an email.

    I have had a paperless direct deposit system for years at my last 2 employers.  Yes, I get a email that I have been paid, but I can ALWAYS print out a detailed remittance that shows gross, net , FICA, sick time and vacation accruals. for both the current pay period and YTD totals.

    0Reply
  • Michelle Elsaid
    Real Estate Agent · Orlando, FL · Member since 2015 · 127 posts · 39 votes
    9y

    You can verify employment through the employer directly.

    0Reply
  • Johann Jells
    Rental Property Investor · Jersey City, NJ · Member since 2011 · 1k+ posts · 876 votes
    9y
    Originally posted by @Michelle Elsaid:

    You can verify employment through the employer directly.

     I get tenants that work at startups, once the tenant actually answered the phone while I was trying to contact his employer. 

    0Reply
  • Deanna McCormick
    Minneapolis, MN · Member since 2013 · 2k+ posts · 1k+ votes
    9y

    Isn't most of the reason for a credit check to verify credit score.. so all the other verification stuff would be after the credit score has met the criteria.. then if you need actual pay stubs, ask but I the credit report a more stable gauge. 

    If it looks like a duck, swims like a duck and quacks like a duck it's probably a duck..

    0Reply
  • Caleb Heimsoth
    Rental Property Investor · Durham, NC · Member since 2016 · 7k+ posts · 7k+ votes
    9y
    The best way to spot this would be if their pay stub company name doesn't appear on their bank account. If they have regular deposits but the names don't line up, most likely something is fishy. I even had one lender ask for 12 months of bank statements. With that level of detail it would be hard to get around it with fake pay stubs.
    2Reply
  • Mike Kiefer
    Member since 2018 · 1 post · 0 votes
    8y

    What if someone is required to provide the past 3 years of tax returns?  How can you validate that they are real and filed returns.  They could have just filled out the forms and not filed.

    0Reply
  • Christi HawkinsPro Member
    Columbus, OH · Member since 2017 · 237 posts · 142 votes
    8y

    @Mike Kiefer that's when you order the tax transcripts from the IRS directly. The borrower/renter will have to be the one to request them and the IRS will tell them they will mailed in 2-3 weeks. When I was a lender to expedite that process I'd have the borrowers come to my office, make the call to the IRS and tell them they wanted it faxed right away. They will make the borrower confirm they received the fax and I used to get them within 10 to 15 minutes. That's the only way to really verify the documents they're giving you and it's super easy 

    3Reply
  • Jack B.
    Rental Property Investor · Seattle, WA · Member since 2014 · 1k+ posts · 1k+ votes
    7y

    Simple. I had three Asian people in their 20's who all claimed to be working at different jobs/companies. Yet the pay stubs they all provided were all not only identical, but looked so simple they could have been made in an Excel spreadsheet in 5 minutes, no joke...

    I was suspicious at the time, but decided to run their SSN's for the background check...except their SSN's were invalid. They claimed the site didn't work. When I looked into it, the error message was clear: they were using invalid SSN's. I think they were illegally in the country and that I dodged a huge bullet.

    0Reply
  • Aaron Poling
    Realtor · WV · Member since 2018 · 454 posts · 310 votes
    7y

    Check to see if things match with the tax returns, and verify directly with the employer. You may also want to inform the tenant that submitting forged documents is fraud and highly illegal. 

    1Reply
  • Calvin OzanickBusiness Member
    Property Manager · Janesville, WI · Member since 2017 · 707 posts · 297 votes
    7y

    Something I have found is that if a tenant is providing fake pay stubs, their employer may not give the best review. When I contact a work supervisor, I am able to get much more information than verification of employment. I find that if you ask questions about tenure, punctuality, workplace disputes and other things of that nature, you are able to get a better feel of the tenant.

    Also, when I interview tenants, I would simply ask them questions about the pay stub. Hours worked per week, hourly wage, etc. This way, you can verify if the numbers add up or not. 

    Wisconsin Property Managers4.7413 Reviews
    WebsiteView Page
    1Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free