With more than 100 million consumers affected by recent information breaches at Target and other retail stores, it’s helpful for apartment management teams to understand how to deal with prospective residents who cite complications from such instances. Below, Debra Stockton, Senior Vice President of LeasingDesk Screening for RealPage, offers answers to the four biggest questions leasing professionals and property managers have about leasing to prospective residents who are victims of identity theft:
1. How should apartment communities deal with any recent lease applicants who cite complications that come from Target or any other breach in the past year?
Consumers who are the victims of identity theft are protected by the Fair Credit Reporting Act. This means that consumer reporting agencies, such as RealPage, are required to work with the consumer to help resolve any issues. Apartment communities can inform the affected lease applicant about the options offered to them by the national credit bureaus and RealPage:
- File Freeze: A consumer can place a file freeze on his or her credit report to prevent the credit bureau from providing information to anyone on that consumer. The only way to release this information is by the consumer calling the credit bureau and giving a PIN number. Occasionally, RealPage encounters a lease applicant who placed a freeze on his or her credit file. In these instances, we work closely with both the client and the consumer to provide instructions on how to release this file, so that the apartment community gets what it needs to process the lease application. A consumer can also place a freeze on his or her RealPage file, preventing a screening report being delivered to the apartment community without consumer permission.
- Fraud Alert: A consumer who finds the file freeze to be a hassle can place a fraud alert on his or her file. This fraud alert is passed to the apartment community by RealPage, cautioning the apartment community to verify that the consumer is in fact the person whose credit has been requested.
- Identity Theft Report: The third option is for victims of identity theft to file a report with a federal, state or local law enforcement agency. This report should then be shared with the national credit bureaus and any other consumer reporting agency (such as RealPage). Once an identity theft report (and any other required information such as proof of identity) is provided, the consumer reporting agency is required to block the known accounts as being fraudulent within four business days. Keep in mind that the consumer is subject to criminal penalties if he or she files a false identity theft report. And, the consumer reporting agencies have the right to decline to block or rescind a block under certain conditions set forth in the Fair Credit Reporting Act.
2. What information can be seen in their credit reports, if they had been victims?
If the consumer placed a fraud alert on his or her file, the community will be able to see the consumer’s credit report, along with the fraud alert. If the consumer filed an identity theft report, any fraudulent account(s) identified by the consumer would be blocked from appearing on the report. A file freeze prevents the sharing of the consumer’s credit report with the community, unless the consumer requests that the freeze be lifted.
3. What are leasing agents allowed to ask?
Leasing agents should ask any consumers that claim to be victims of a data breach if they have contacted the national credit bureaus and participated in any of the options available. Have they: Placed a file freeze on their credit reports, placed a fraud alert on their credit report, or filed an identity theft report with a law enforcement agency.
The leasing agent should also request various items for proof of identification, such as a utility bill and driver’s license, to ensure the information matches and that the consumer is in fact the person for whom they are requesting a screening report.
4. How should communities factor in such credit “problems” and have you heard from any clients about how resident applicants with damaged records might falsely “suggest” it is due to a breach?
Apartment communities shouldn’t have to worry about factoring in these credit problems. If the consumer has in fact been a victim of identity theft and has not filed a report, the apartment community should request that the consumer do so through the proper channels. This will cause the fraudulent accounts to be blocked on the consumer’s report, removing them from consideration for the leasing decision. This request might cause consumers who are falsely suggesting their bad credit is a result of any data breach or identity theft to move on, as they might not be willing to take the necessary steps to clear up their credit. True identity theft victims will appreciate the help - not only so they can rent an apartment, but also because their credit will no longer be affected by the fraudulent accounts.