Tenant Credit Check site missed 2 evictions

[Jeff Twigg]

I listed a single-family income property for rent and quickly found an interested party. It was two retired women that decided to split their housing costs as their expenses are rising faster than their income. I use Cozy.co and have my tenant applicants apply via that website. When I sent the ladies the Cozy.co link to apply, I received a tenant credit check from a different website....ApplyConnect.com. I looked into the site and even found posts on BP deeming it credible. So, I gave them the benefit of the doubt and used this credit report. One of the applicants had a low credit score, so I asked for proof of income and explanation. I received legitimate bank statements demonstrating proof of a fixed income adequate for the rent amount. She gave me a sob story, which gave me some suspicion, but her co-lessee had stellar credit and satisfactory fixed income. I decided to accept these applicants, though I chose not to accept them on ApplyConnect.com.

Next, they gave me a security deposit of one month's rent, and I agreed to take the listing off the market. We were still finishing renovations, so they were the first to see the new kitchen, baths, etc and there were no interior pictures online. Then, we finished the reno and had the tenants walk-through and inspect. Thrilled with the finished, they were ready to sign the lease and get the keys. I require renter's insurance, so I told them to set that up and I'd send the lease over via docusign. 

I received a message late the night I sent the lease via docusign, stating that they did not agree to such a high annual rental amount. The next morning I saw the message and, though confused, demonstrated : monthly rent X 12 months = total sum of rents. The tenant also indicated that I misspelled her last on the lease. My suspicion returned and I combed through my files in detail. I had her name spelled incorrectly the entire time, which she hadn't corrected me on until now, but her credit report via ApplyConnect.com had her name spelled properly. I opened the report to view it again (as viewed below) and rest assured no evictions found. 

I've learned to trust my intuition as I get older and have more experiences to back it up. This time the earlier suspicions were boiling over. I decided to do my own background check on this tenant. I immediately found 2 local evictions that occured in the previous 10 years. This violates a non-negotiable policy we have of not renting to anyone with prior evictions. 

Now for my request for advice on the following questions:

What is the best way to handle this situation? My goal is to find a new tenant immediately, return the deposit to this applicant, and avoid making any legal mistakes in the process. 

Can I tell her she is no longer permitted to rent this home? If so, how?

How do I return her deposit to her? Cashier's check delivered by certified mail? 

How soon can I repost the listing for rent?