Real estate is highly attractive, requiring buyers to stay alert during transactions to avoid fraud and costly mistakes. Fraud can lead to loss of money, time, and the stress-free life you once had. This means that real estate buyers are armed and prepared to not be a victim of scams in the process.
Here are seven common real estate scams and tips on how to avoid them:
1. Wire Transfer Fraud
More specifically, con artists get to know the specifics of a real estate transaction and then proceed to send you fake e-mails that appear to be from your real estate agent or your escrow officer. They will tell you to send your down payment or closing costs via wiring to another account they control.
How to avoid it: In addition to identifying the fraudster, verify the request with your agent or escrow officer using any secure number. Never confirm any bank details over the phone or physically only via email as this is a common fraud area.
2. Foreclosure Relief Fraud
Another common Mortgage fraud instance is where con artists target homeowners that are in default paying their mortgages, thereby proposing to help them reduce their amount or almost halt the foreclosure process for a fee. In fact, they just sit down and vanish into thin air the moment you make the payment.
How to avoid it: Scam companies often will require you to pay upfront or promise them that can prevent foreclosure. If you need help, always work with your lender or a HUD-approved housing counselor.
3. Fake Landlord Scams
Such scams can mostly be seen in rental markets and scams. Scammers advertise fake rental property, get deposit and rent from unsuspecting tenants then disappear. OFTEN, they do not even own the property.
How to avoid it: If the article is being sold at a low price you have to carry out further research since the prices could be fake. Do not use such payment methods as wiring money or paying in cash and only sign a lease and make an appointment with the landlord to view the property.
4. Title Fraud
They strip you of your identity and then use it to write cheques, prepare forged records to transfer the deed of your home to them or a third party. They can access loans using your property as security and you are stuck with the loan balances.
How to avoid it: Look up your home’s title on a recurring basis at your local county office. It is possible to purchase title insurance and be safe in case such a fraud takes place.
5. Bait-and-Switch Contractors
These scammers will quote you a cheaper price when they know fully well that they intend to up the price halfway through a renovation project or way after it has been done. They can also steal your money and do only half of the work required of them.
How to avoid it: Bid at least three quotes, ask to speak to past customers, and don’t pay the contractor in full until work is completed. The written contracts that should be used include the scope of work, when the work will be done and how much will be paid.
6. Fake Real Estate Agents
These scammers pretend to be professional realtors, they may show houses or even work out contracts. Once paid an initial deposit or some form of an advance, they are not seen again.
How to avoid it: Real estate license check should be done with your state’s real estate commission. Do not trust anyone that demands so much money in advance without having an agreement.
7. Escrow Company Scams
How to avoid it: Whenever possible, ensure that you are using the services of a certified escrow company. Your agent, realtor or lawyer could suggest a reliable escrow service or company.
Real estate is a big investment whether you are looking to buy a house or sell your property, the last thing you want is to be conned. To stay informed and to hire certified consultants, such scams can be avoided. If it feels wrong, do what is necessary to check and double check every aspect of the transaction. By following these tips, you can reduce the risk of falling victim to real estate scams and keep your investment safe. Visit Gold Homes LLC for more blogs, expert insights, and guidance.