Alright, so here’s a rental property scam — and it’s a new one on me. Full disclosure up front: I’m not here to give you advice on this one because I honestly can’t figure out how the scam would even work. But it’s worth talking about, because if it’s happening to one of my managed properties, it’s probably happening to other Philadelphia rental property owners too.
How I Found Out About the Scam
My property management company got contacted by the City of Philadelphia’s Landlord Tenant Diversion Program. They felt very strongly that a scam was being attempted — a whole string of them, actually — and one of the properties I manage was on the list. The city had already flagged it as a likely scam. They were just calling to confirm.
Here’s what was happening: a fraudulent individual was contacting the city claiming to be a property owner. They were saying, “Hey, I have a tenant in distress, we need to get into the Eviction Diversion Program.” The city, doing their due diligence, reached out to verify.
What Is the Philadelphia Eviction Diversion Program?
Quick background. The Philadelphia Eviction Diversion Program is designed to divert tenants away from needing to be evicted. The way it works in practice is the city hands the landlord roughly $3,000 of the tenant’s past-due rent in hopes of avoiding an eviction filing.
In my opinion? It’s not effective. All it really does is buy the tenant more time. If a tenant needs to be evicted, they need to be evicted. The $3,000 just delays the inevitable.
Why the Diversion Program Hurts Landlords
Here’s the rub. As a rental property owner, you might think, “Great, I’m getting $3,000 of the money I’m owed.” But then the tenant’s clock resets. You’ve already hired an attorney, you’ve already waited months to get into a hearing, and now you have to start all over again.
A tenant who’s not paying rent now is not going to pay rent in the future. They’re not going to keep going back to the city and pulling another $3,000, and another $3,000. So you re-hire the attorney, pay the filing fees again, wait another four months for a hearing, and in the meantime the tenant is still living in your property destroying it.
The Reality of Evictions in Philadelphia
My property management company doesn’t have to evict tenants we screen ourselves. But owners come to us in distress all the time — they’ll call and say, “We don’t want to hire a property manager, but we need an eviction.” We evaluate the situation. Sometimes there’s a misunderstanding and we can bring resolution. Sometimes they genuinely need to evict. So I’ve been through this process a lot.
And here’s an opinion that’s not politically correct, but it’s what I’ve actually seen. In every single eviction I’ve handled, the tenant who needed to be evicted was not a single mom down on her luck. It wasn’t somebody who hurt their back at work and couldn’t pay bills. Not once. It’s almost always somebody with a job who simply doesn’t feel they have to pay rent. In my experience, that mindset often comes with mental health issues.
You see it in the property after they move out. The damage is significant. So if you extend that tenancy an extra five or six months through the diversion program, imagine the damage you’re going to walk into. You have a vested interest in getting a non-paying tenant out — fast.
Back to the Scam — What Was the Angle?
So here’s where I’m stuck. I don’t know what the scam actually is.
For this to work, someone would have to convince the City of Philadelphia to cut them a check. But the city already knows the owner’s address. They know my property management company’s address. They have all our contact information on file. If they were sending money anywhere, they’d be sending it to us — the registered agent on the property.
Remember, if you own a rental property in Philadelphia, you’re required to have somebody within the city limits designated as your agent. You can’t live in Delaware, own a Philly rental, and legally register it without a local agent. For most of our clients, Grow Property Management is that agent automatically. So the city has a clear paper trail on who to contact and where to send funds.
The scammer isn’t on that paper trail. So how are they getting paid? I don’t see it.
How It Got Resolved
Honestly, it was a non-issue. The city called, said, “Hey, we think this is a scam, can you confirm?” We confirmed absolutely not — the tenants in that property have always paid their rent, nobody at our company or the owner requested diversion assistance, and the name on the fraudulent request wasn’t attached to the property in any way. Quick phone call, done.
What Landlords Should Take Away
A few things worth pulling from this:
- Have a designated agent on your Philadelphia rental. Not just because the law requires it, but because it’s the person the city calls when something like this pops up.
- Think carefully before entering the Eviction Diversion Program. The $3,000 sounds nice, but you’re likely just delaying an eviction you’ll still have to file — while paying attorney fees twice.
- Screen your tenants properly on the front end. The best eviction is the one you never have to file. This is why we’re so aggressive about screening at Grow.
- If something feels off, call the city or your property manager. Philadelphia flagged this scam themselves. They’re paying attention.
If anybody actually knows how this scam works — how the fraudster gets paid, how it damages the owner — I would genuinely love to hear it. Drop it in the comments. Because right now I’m looking at it as a non-issue, but I don’t like not understanding something happening in my own market.
But what do I know? I’m just a humble Philadelphia property management company owner doing my best to answer your rental property investing questions. As always — happy rental property investing.
