S
anaulhaq Zarawar's rental property in Whitby, Ont., has become a nightmare. His tenant won't pay rent and refuses to leave. Zarawar hired a real estate agent to find him a reliable tenant, but the agent didn't include vetting in their contract. The tenant moved in last year, but several months later stopped paying rent. When Zarawar investigated further, he discovered what he believes is a fraudulent application.

    The tenant listed fake employers and claimed a second applicant would be contributing to the rent. Zarawar says the real estate agent verbally promised to do background checks, but that was not included in their contract. The tenant now owes him nearly $40,000 in unpaid rent and utilities.

    In many Canadian cities, small landlords hire real estate agents to find good tenants for their rental properties. However, these agents are under no obligation to perform vetting or background checks, despite what they may promise verbally. Toronto paralegal Bita Di Lisi advises landlords to request that vetting be added to the contract if they want it done.

    The stakes are high for landlords in a hot housing market where rents remain high and mortgage rates continue to rise. Overwhelmed landlord-tenant boards across Canada face long delays, making it nearly impossible to evict problematic tenants before their rent arrears pile up. According to RentPanda, a rental services company in Ontario, 9.1% of applications reviewed as of May contained fraudulent information.

    Many landlords believe real estate agents are responsible for vetting tenants, but experts say this is not the case. Di Lisi suggests that landlords take responsibility for their investments and read their contracts carefully. She also recommends paying extra for credit checks and checking online for legal disputes or complaints.

    Some landlords are calling for change in how standard contracts between landlords and realtors are written. Mischa Hamara, a small commercial landlord in Toronto, wants to see reform so that landlords can hold agents accountable if they don't deliver on their promises.