The Social Security Number: A nine-digit identification code unique to every citizen, permanent resident, and temporary working resident in America. These nine numbers are about as personal as it gets and we’re told to never share it with anyone. So why do we ask for this information on online rental applications?
The first answer most real estate agents or landlords will tell you is to run a tenant verification. However, major credit bureaus such as TransUnion have partnered with application companies to create an all-in-one package (many of which are free for agents) for Realtors to collect online rental applications and tenant verification information in one step.
Instead of handing over their SSN to a real estate agent that they’ve never met, the applicant can give it directly to a trusted credit bureau. Not only does this protect the applicant, but it takes away liability from the Realtor. You can get access to a credit report, background check, and eviction history all without collecting a SSN.
But what about eviction? Don’t you need the tenant’s SSN if you have to evict them?
Although a good tenant verification would reduce the chances of you having to evict your tenant in the first place, the answer is no. While you should always consult a lawyer when evicting a tenant, the California Eviction Form itself doesn’t require a SSN, just the name, address, and phone number of your tenant.
Another thing you might say is, "Well that’s the way I’ve always done it."
If we lived by this motto, we’d be stuck in the same rut forever without progressing whatsoever. The only way to get better is to constantly improve, and staying static is a guaranteed way to hinder improvement.
Now that we covered why you don’t need a SSN on your online rental application, here’s why an SSN could actually be harmful to you.
"Identity Thief" by CafeCredit.com is licensed by CC 2.0
Holding one person’s social security number, much less every applicant you run a tenant verification on, puts a lot of liability on you as an agent. Even if you aren’t the culprit, if the tenant’s identity gets stolen because of your failure to safeguard the information, you could possibly be liable.
Additionally, people are more vulnerable to identity theft while moving. All of that information being transported from one place to another is a perfect opportunity criminals will take advantage of. You want to avoid the headache that comes with an identity theft investigation, and if you had access to your applicant’s SSN, you’d better believe that the cops will come your way.
When dealing with such sensitive information like a SSN, you have to be extremely organized and careful with how you store it. Why would you want to spend your time filing information that is both unnecessary and dangerous to you? In addition, you can save even more paperwork by switching to an online rental application (if you haven’t already).
Yes, there are times where you or the landlord are going to need the tenant’s SSN, for example if the landlord hires a collection agency to collect rent. For these instances it makes sense to collect the SSN on the lease agreement instead of the application. This is a more reasonable alternative than storing hundreds of applicants’ delicate personal information that aren’t even tenants.
The Bottom Line
While it is a valid form of identification, there are equally valid alternatives to genuinely ID your applicant that are much safer. If you need an SSN to feel safe about your applicant, you should think twice about your tenant verification method.
If you only collect your tenant’s SSN after they sign the lease you will not only have less paperwork to file, but you will not have to worry about the countless SSNs of irrelevant applicants in your file cabinet.