In the last 5 years, we have heard a lot in the media about artificial intelligence (AI) and machine learning technology. AI has become more of a “catch phrase” in both marketing and advertising than a true reality within most technological platforms. According to Techopedia, AI is an area of computer science that emphasizes the creation of intelligent machines that work and react like humans. As it relates to tenant screening, AI is an untapped area where once manual processes such as landlord verification, rental history verification, income verification, and employment verification can now be automated.
VerticalRent, the pioneer in advanced tenant screening technology, has developed the industry’s first AI technology (coined as ‘AI Boost’) that is applied to the electronic rental application for landlords. AI Boost™ identifies patterns, omissions, and potentially falsified data submitted by a prospective tenant on their rental application. Our proprietary AI technology compares an applicant’s self-reported address history on the rental application to their actual public record address history. AI Boost™ learns, evolves, and continually identifies emerging patterns to help recognize accidental omissions and potentially falsified data. Throughout 2019, we will introduce enhancements to AI Boost™ that will automate other key aspects of the tenant screening process for both property managers and landlords.
Let’s look at why we developed this industry changing technology.
Rental Application Errors
Often, the rental application is error prone due to the human element. When a prospective tenant is completing a rental application, they are likely pressed for time in this frenzied world to submit as quickly as possible. This often results in unintentional omissions to key areas of the rental application such as the rental address history section, past employers, and references. What’s more is that renters often do not remember the exact street names of the places they lived in the past or their past employers phone numbers, so they’ll skip over certain sections of the rental application.
Additionally, information related to their prior landlords is often unknown and takes research on the applicant’s behalf, which slows down the rental app submission time window. With the demand for hot rental properties in major cities, a prospective tenant is worried about losing his or her place “in line” for a rental vacancy. The rush to submit a rental application often results in errors and omissions. In rare cases, potential tenants may also falsify key information on the rental application to avoid further investigation into an area of their past.
This is a common phenomenon for renters across America. The resulting issue is that many landlords are screening their prospective tenants on erroneous data. Of course, it is possible to obtain a credit report on an individual with a limited set of data such as their full legal name, DOB, and SSN – but a comprehensive background check goes far beyond the credit report. It is also possible to pull a statewide or nationwide criminal history report from only a full legal name and DOB – but those data points do not paint a full picture of the prospective tenant either.
A comprehensive background check is time-consuming and extends far beyond the standard reports included in most tenant screening application packages: the credit, criminal, and eviction report. The manual checks involving past landlord references, address history, employment, and income all require additional time and effort with an element of human error involved. With the advent of Artificial Intelligence techniques, VerticalRent’s AI Boost™ is pioneering the automation of much of the manual tasks required as well – making a comprehensive tenant screening possible for smaller landlords and delivering on the promise of Artificial Intelligence.
Painting a Full Picture of a Prospective Tenant
In 2016, VerticalRent started offering a free applicant discovery report to landlords across the United States. The free report provides landlords and property managers with an applicant’s movement patterns, whether they went by an alternate name, or if they lied about their date of birth. This free report also provides the issuing state and date for the applicant’s social security number.
Fast forward to 2019. In the last 3 years, we have analyzed the tenant screening patterns of over 50,000 landlords across America. Our analysis revealed that most landlords are only focused on four (4) key components to make a leasing decision, which include: the rental application, the credit report, the criminal report, and the eviction report. Each of these reports are critical inputs to the tenant screening process, but do not paint a full picture of the prospective renter. Two key elements of VerticalRent’s AI Boost™ include the rental address history and landlord reference check.
- Rental Address History – On a rental application, most landlords will ask for the address history for an applicant. What most landlords fail to do is verify & validate the accuracy of the rental address history against public records. VerticalRent AI Boost™ does this at no additional cost and automatically for landlords when accepting an electronic rental application.
With AI Boost, landlords can rest assured that the address history self-proclaimed by renters is systematically checked against all public records available for an applicant. We automatically cross-check each address and generate a discrepancy report for a landlord to review. This gives landlords and property managers the insights necessary to identify omissions, errors, or oversights by their applicants and give them an opportunity to correct it before rejecting the application. Landlords can also identify gaps in living history where an applicant may have intentionally omitted a timeframe in their past where they broke a lease agreement, were evicted, or left on bad terms with the previous landlord.
By having this information at your finger tips with AI Boost™, you can look beyond the standard credit, criminal, and eviction reports. You can draw insights from an applicant’s rental history while harnessing the power of VerticalRent’s proprietary AI technology.
- Landlord Reference Check – Most applicants are quick to provide personal or family references on their rental application. Its common sense to provide a reference of someone like Uncle Jake who will talk highly of you no matter what. Job seekers will do the same on their employment application and that is why many employers ask for the names of previous supervisors only.
Many first-time landlords and inexperienced Property Managers fall into this trap of accepting personal and family references. This is a mistake for several reasons. The obvious reason is that a personal reference is highly subjective and biased. Whomever the individual, whether it be a friend or family member, is bound to provide a positive & glowing review of the applicant without knowing objective information like whether the applicant follows the lease rules, or if the applicant has been flagged for noise violations in the past. This type of information can only be uncovered by checking on landlords who rented to the individual in the past.
The problem is that many landlords decide not to divulge information about prior tenants in fear of lawsuits. What if their words are twisted, or taken out of context? But many landlords will provide information that relates specifically to objective information about an applicant. For instance, a tenant may have broken the lease without warning, or may have been involved in several noise complaint violations.
With VerticalRent AI Boost™, we cross-check the prior address history to public records to identify the current owner of a property. Chances are that the property owner is the landlord that your applicant paid their rent to every month. If not, then either the property was sold to another investor, or a property management company oversaw its operations – which would be available on the rental application. Our AI Boost™ engine does the comparison for you and provides you with a discrepancy report to conduct further analysis. You can electronically request for the applicant to provide additional information about their self-proclaimed references, correct their rental application, or disqualify them based on the information they provided. This additional checkpoint paints a full picture of the applicant and helps surface past behavior that could lead to future trouble.
As we move further into 2019, our AI Boost™ technology will be enhanced to include other checkpoints, such as: income verification, employment verification, and the automation of landlord reference checks. Each of these checkpoints will be built into AI Boost and available simply from accepting an electronic rental application from an applicant. Meanwhile, we encourage you to continue submitting your feedback and suggestions to how we can continue improving upon our tenant screening features of VerticalRent. With over 50,000 landlords and growing – we continue to set the precedent for new features for independent landlords owning between 1 and 25 rental units.
PS … we can’t wait to see the competition (you know who you are) begin copy-catting what we release in 2019 like previous years! It’s flattering… .