By Glenn Morris
As we all know we operate our business in the real world, which is not a perfect place. As a generalisation, it is better to have tenants who are law abiding and good citizens.
Normally the criminal activity of the tenant will impact on the tenancy and in some cases, the landlord will need to either seek assistance from the Police or provide assistance to the Police. I have recently had some interesting events that called for a joint approach between the landlord and the Police. I think you will be interested in what happened.
Once upon a time last year, I received an application to rent a small flat. The tenant, Mr. Henderson, was living temporarily at Franklyn Village. He filled out an application form and the credit check off Veda did not reveal any problems. I did wonder briefly about the low activity count on it but it seemed consistent with his story about recently returning from Australia. The flat was a moderate priced, simple flat and he fitted the bill so I accepted him (In hind sight I wonder why I did that). Immediately, the rent flow was erratic and I soon issued a section 56 letter giving him 14 days to sort his act out.
I observed that the car registration he had given me had two of its numbers reversed. Even good people get numbers mixed up all the time but he was being bad, so I did a check on that vehicle and discovered it was registered to a different person called Mr. Hetrick. I did a credit check on that name with the same date of birth and it showed this was clearly the name of my tenant but there was still no adverse credit information on that file. Aha! I thought there was something bad going on here. The case proceeded to the tribunal, I got an eviction ending the tenancy after five weeks and by the time the bond was released, I was about square. I located a lovely good new tenant and forgot the incident.
Then out of the blue a few weeks ago, I get a serious looking official letter from an investigating officer at Veda asking me to provide evidence as to why I carried out a credit check on these “two” different people. My heart raced thinking of the penalties and repercussions of being banned from Veda. My company dutifully keeps all applications and other documents for years and years. Paper is everything when up against the wall fighting for your survival. Forget the computer. That will not stop a bullet. Well, I produced the bit of paper giving me approval for the false name Mr Henderson but there was no approval for Hetrick. Oh dear this called for some fast talking! Veda emailed me making some serious allegations, saying I had no approval to credit check Hetrick. I responded in equally robust, aggressive language, pointing out that one body two names is not two people. The penny dropped at their end and they sent me a lovely back-off communication saying I was clear.
My spirits rose and I punched the air with my fist! Then a few days later the phone rang…
“Hello this is CIB Nelson. We are investigating a fraud case. Can you help us? We have on record you made a phone call to us about a certain character living at this address last year.”
They did not even know about the Veda investigation. I was again, able to supply all the information, plus some other details. It turned out the character had a third real name of Paterson and had stolen the identity of a high school mate. He was using this false identity to register his car, driver licence, power account and so forth. The real Mr Hetrick who lived in Auckland was desperately trying to get this criminal out of his life. So I wonder what I did wrong. Can I be smarter next time?
These things need to be done. Make all applicants fill out an application form. Go here to get a good tenancy application form.
Make sure you sight some form of identification. If they have driven to the rental and say they do not have one with them then ask yourself a couple of questions!
It is recommended you take a photo of their drivers licence and one of the tenant themselves. Generally “sods law” applies. If you omit taking one you are bound to regret it later. You might not need the photograph but the police and other authorities like Immigration and WINZ might be pleased to get a copy at some stage.
Car registrations are very handy. I often struggle to work out the exact spelling and correct sequence of some people’s names. The LTA has suddenly got a bit more protective of their information and have tightened up on who can access it. However after being missing from the Veda site for about two weeks, it has reappeared along with a long list of boxes you need to tick concerning your reason for looking. A motochek will tell you if a vehicle is WOF and registered, the last address of the owner, and later on it “should” tell you the new address of the departed tenant (debtor). All handy stuff when you are looking for a debtor. I do note that Motochek is not an option offered “yet” by TINZ.
Go to QV or Terranet and pop in the name of the previous landlord. Normally if all is well then the property that the wonderful applicant is currently renting should show up as being owned by the given landlord. You can do that search for free. However, not being able to confirm the owner that way does not necessarily mean a false landlords name has been supplied. Many properties are managed by commercial operations, friends and family. For $2.95 you can purchase an online “Property Valuation Report”. This normally will supply the name of the owner.
Then when you phone the previous landlord/property manager for a reference, you will be able to ask some trick questions, to ensure you have not just reached a friend of the applicant. Friends normally give a glowing reference (surprise!).
Now I would not want you to think I, or you, cannot be outsmarted or deceived from time to time. If you never take a chance, then you will miss out on some great or at least satisfactory tenants, from time to time. I heard recently of a management firm located out of Nelson but managing a few local properties who would not accept a refugee because they could not do a reference and credit check on the applicant. I think such an action is not only stupid but also shows that the owner of those properties should have a good shake up and choose a local firm.
Being deceived is an occupational hazard and is not the end of the world. If in doubt make sure you have an escape plan. Think twice about signing up questionable tenants on a fixed term tenancy. Being able to give a 90 day notice is simple and stress free. If the rent is not forthcoming then get onto the job right away by issuing written warning notices, regardless of the heart pulling tragic reasons for not paying. Remember you do not need to wait for the 14 days to expire before making an application. A sudden flatline payment history needs to be acted on urgently by making an application to the Tenancy Tribunal. If you have over-reacted and the patient rises from the dead and pays up, then all you have to do is withdraw the tribunal application.
Glenn Morris is the owner of Nelson property management company, “Glenn’s Vacancies”, managing residential and commercial investments. He is the current secretary of the Nelson Property Investors Association. He was active in the review of the RTA and is a well-known figure in the property investment community. He has a reputation for effectively managing difficult tenancies.”
