How Far Back Should Employment Verification Go?

Every landlord wants tenants who can afford to pay their rent—and on time. But with fraud on the rise, getting reliable renters in the door isn’t always so simple.

According to a recent survey by the National Multifamily Housing Council, over 93% of property managers have experienced fraud in the application process. And 70% of those are detected after they’ve moved in.

Employment verification is just one step to help prevent fraud and ensure your tenants are indeed who they say they are (and can pay their rent).

The Purpose of Employment Verification in Tenant Screening

To prevent fraud and bring in residents who can actually pay rent, you need to be able to spot the bad actors—and approve your next model tenant. How do you do that?

Conduct thorough employment verification as part of your tenant screening process so you know they can meet rent obligations and that they have stable, consistent income. 

Employment verification should be thorough but not slow—employment verification software can help you make the process efficient, too.

We’re unpacking exactly how to identify the patterns of tenant reliability through a solid employment history. And we’ll help you avoid the potential consequences of not verifying employment that can cost you thousands.

Typical Timeframes for Employment Verification

Verifying employment takes anywhere from a few days to up to two weeks for the average application. Typically, property managers require a mix of pay stubs, tax returns, and employment verification letters.

But the more documents you require, the longer verification could take—especially if you’re doing manual verification. And with an uptick in manufactured pay stubs and W2s, extra due diligence is a must. Naturally, that adds more time.

Employment verification letters are a popular choice to confirm income details. These official letters come from the applicant’s workplace and contain criteria like employee status (full or part-time), length of employment, salary, and job title.

Expect a 2-5 day turnaround on employment verification letters, but recognize that additional follow-up can extend the timeframe.

Pay stubs are a go-to form of employment verification. Real pay stubs won’t have any typos, misspelled names, blurry or low-resolution print, or accounting errors, and usually aren’t round numbers (like $2,000 rather than $1,978.35).

This step alone can take several days to a week, depending on the responsiveness of the points of contact and the property manager’s workload.

So, how far back does employment verification go? Standard practice is to look at the previous 1-2 years. Not only does more recent employment more accurately reflect an applicant’s current financial situation, but it also gives you insights into their financial stability.

Potential Exceptions

With more people taking extended breaks from work to travel or build families and the gig economy booming, employment verification can become a challenge. Let’s take a look at a few situations that make income verification more difficult.

Layoffs

Several breaks in employment can be a red flag. But with the job market seeing widespread layoffs across sectors, with 1.8M people laid off in December 2024 alone, breaks are becoming more common. That’s many faithful tenants with a dreaded stain on their employment record—for no fault of their own. 

A disheartening situation? No doubt. But regardless of the circumstances, people still have to meet their rent obligations. What are the chances that a layoff—or other temporary unemployment blip—will result in a missed rent check for you? 

Maybe not as much as you might think.

A survey conducted by the Federal Reserve in 2022 found that 54% of adults have a 3-month cushion to cover expenses. Over half of the American public can float rent, groceries, and gas at least as long as it takes to find a new job, which is around 3 months.

Combined with their previously clean track record, this may indicate they are actually a reliable tenant despite the unexpected setback.

Freelancers and high-income earners

Freelancers may not have a typical rhythmic payday. Income can be all over the map—large deposits and small ones, with several in a week or nothing for months. They can come from several sources, too. That means you may need to take a closer look at the financials.

Beyond checking deposit amounts and frequency, you can also check these:

Net income. Gross income may look impressive at first glance, but your tenant doesn’t see all that money. They pay based on the money they net after other expenses and deductions are removed—those include taxes, social security, insurance, retirement, and investments.

Debt. Self-employed people may carry more debt than a full-time employee, which reduces how much money they have to work with at the end of the month. Calculate the debt-to-income ratio to determine if they meet your income threshold requirement.

Renter history. A history of on-time payments with other companies is a good sign an applicant would pay you on time, too. Check manually by calling previous housing management offices or get it done faster with Snappt verification services.  

Factors to Consider When Determining How Far Back to Go

How far back does employment verification go? It shouldn’t be left up to a gut feeling. With fraudulent tactics becoming more sophisticated, old detection methods might not be enough to avoid a bad tenant. 

Many property managers rely on a standard stack of 2–3 months of pay stubs, a current W2 or 1099, and bank statements. We recommend going back at least one or two years. Here’s a filter to run your applicants through once you have their documents. 

Income Stability

You want to make sure your applicant is currently employed and has a history of consistent employment, leading from one place of work with minimal or no gaps in the timeline. 

Type of Employment

Consider the nature of an applicant’s work. Is it freelance vs. W2 employment? While either option comes with pros and cons, understanding their job status helps you understand how they get paid.

On top of that, consider their industry and whether it’s a stable or volatile sector at the moment. For example, a freelancer may land a $60K contract that could cover an entire year of rent but be the only one they get all year.

Rental Property Requirements

While some rental properties are more bare bones, there are plenty of luxury units that often charge monthly rent at rates triple standard apartments. 

If your property is a higher-priced luxury unit, you may want to conduct a more extensive investigation into the tenant’s employment history and confirm that they can indeed pay the higher rent.

Applicant-Specific Situations

First-time renters or students may not fit into typical parameters. They may not have a long employment history and likely require a more thorough review of proof of income and their reliability as tenants.

Another unique situation is when someone has frequent job changes—whether from involuntary layoffs or job hopping. 

These are all nuanced considerations without a clear-cut answer. Hedge your bets with a more complete picture through a far-reaching verification process that includes several documents and checkpoints.

Challenges of Verifying Older Employment

The IRS requires companies to keep employee tax documents for at least 4 years. Those records contain all the information you need to verify an applicant’s identity, salary, and employment history.

But some companies are stricter than others with what information they’ll share with you over the phone. That said, most will at least confirm whether or not an individual worked at the company. 

Be cautious about how far back you go in their employment history, though. Just because an applicant was gainfully employed once, it doesn’t mean they have been for the last year or two.

And the farther back in time, the more the records may be incomplete or missing key information. Recent work history (last year or two) is a much stronger indicator that they have the financial stability you’re looking for.

You can request the same information via a screening company, but that also comes with a speed bump. The Fair Credit Reporting Act requires written permission from the applicant to pull this report. Build that consent language into your applicant forms to avoid delays in your verification process. 

Best Practices for Employment Verification Timeframes

Pulling the last 1-2 years of employment history doesn’t take any longer than gathering details from the last 2-3 months. Or, at least, it doesn’t have to.

In cases where applicants seem to have a solid employment history, you should focus on the details in their W2, 1099, tax returns, and bank statements to be sure of their standing. 

A start date tells you how long they’ve been making their salary. A job title helps you evaluate if their salary claim makes sense (and if they can afford the place). Frequent gaps in employment mean they probably don’t have consistent income. You get the picture.

With manual verification processes, many factors impact wait times. Employer responsiveness, back-and-forth communications, and how detailed your check is can easily push the timeframe longer.

And if reports show career gaps or job hopping, that could slow you down further. Why? Because you’ll want to look further back—consider collecting employment information for the last 5 years. 

You can pull these records and analyze them yourself. But that takes time and introduces human error into the screening process. Plus, you’ll only catch the fraudulent tactics you know about.

Automated verification processes can cut that time down to just a few days while eliminating human mistakes, fraud risk, and delays. 

With the tenant’s consent, the system connects to financial institutions and employment databases to run the verification for you. Beyond saving you time, this approach is more accurate, reliable, and secure. 

Alternative Methods for Evaluating Employment Stability

While employment verification letters and manual phone calls provide a snapshot of an applicant’s current financial situation, it’s a limited view. And that can hide red flags.

When you need a clearer picture, a multiple-document checklist going back 1-2 years delivers the most accurate picture of an applicant’s financial situation. 

Verify their employment history with all or a mix of: 

Paystubs. Maybe the most popular method of employment verification, these provide the employer information, amount of payment, taxes paid, and other contributions.

W2, 1099, and tax returns. Tax returns are one of the strongest forms of income verification. While W2s are best for full-time employees, freelancers and self-employed individuals may have 1099 forms. In either case, tax returns are hard to falsify and reveal all claimed income streams. 

Bank statements. These provide a window into an applicant’s deposit history, which will help you confirm regular monthly deposits—and exactly how much that figure is.

Employment verification letters. These letters confirm employment status, job title, salary, and length of employment.

Offer letters. This is usually requested when an applicant is starting a new job and may not have any income with their new company yet.

If an applicant doesn’t have sufficient proof of income but wants assurance that rent checks will clear on time, you can require a guarantor or a co-signer. These are separate parties with better financial standing than your applicant, who promise to make the payment if the tenant doesn’t.

Balancing Thoroughness and Efficiency in Tenant Screening

You want to collect the most relevant information from your applicant so you can see just how reliable they’ll be with their rent commitment. But you also don’t want to slow down the tenant screening process.

Rushing could mean you miss something vital that would disqualify an applicant while waiting too long may mean you lose their interest. You need to streamline the process through sophisticated tech solutions. 

Automated verification systems (like Snappt) use real-time data enhanced with artificial intelligence to expedite the process. These systems not only speed up the process but also increase the accuracy and quality of verification.

Gather enough information as necessary, but avoid deep dives into employment history unless you have substantial application concerns or they have a unique situation.

Get More Quality Tenants with Thorough Employment Verification

Verifying 1-2 years of employment history usually gives you a solid read on an applicant’s financial stability, but some cases call for a more thorough examination. 

By layering multiple proof-of-income documents—like tax returns, pay stubs, and employment verification letters—you get the clearest picture possible. And automated verification technology helps strike the right balance between speed and accuracy.

To ensure you bring in the best tenants, add a streamlined verification process to tenant screening. By verifying employment, you ensure future residents are reliable and can pay their rent on time.