Top 5 Real Estate Scams
Real estate scams are a serious problem in today’s real estate market but thanks to homeowners and renters in desperation to stop con artist on their tracks, says Local Records Office. It can be difficult to know if the deal is too good at times or if it comes with some sort of catch(es).
Working with a prominent real estate agent can be a great way to avoid most real estate scams but there are other things you could do to shield yourself.
We are going to start by identifying the most common real estate scams you may face while seeking to buy a house, rent a house, or even buy income property. We will also be talking about on ways on how to protect yourself from being scammed.
Real Estate Scam: Bogus Seminars
This is a common one, most seminars seem legit from the outside but it falls into the “if it’s too good to be true, it probably is” category. The scam is disguised.
In the beginning you’ll be given “free” tickets to a seminar and a free gift upon arrival but you later find out that the free gift is only given to those that bought the ticket from other seminars and not to those with the free tickets.
This is not a problem if you have extra cash for other seminars, in fact the additional seminars sound amazing but the problem is that most of the seminars are useless, they don’t teach you anything and the idea is to get you to spend more money.
Real Estate Scam: Renting Temporary Empty Houses
This happens frequently. The scam artist will know someone who is going on an extended vacation and will post a for rent ad online. They will sometimes claim to be the owner or an authorized agent to rent out the home on behalf of the homeowner.
Other con artist will drive around looking for temporary empty houses and will break in and change the locks. Other times they’ll enter the house by finding a spare key they discovered on the property.
Other times the scammers will pay friend who are locksmiths to open the locks. Many people who run this type of scam will forge official looking property documents for the victims to sign and collect rent until the scam is discovered.
Most of these end the same, the property owner will return to find the renters who they don’t know living there. This is disturbing, but not uncommon.
Real Estate Scam: Renting Foreclosed on Houses
This certain scam works in a few different ways. In some occasions the crook will work the same way as we talked about in “renting temporary empty houses” section. Other times the old homeowners whose house is in foreclose are the one perpetrator.
The crooks will rent their own home to unaware renters to use the money to buy another home somewhere else. When the eviction date arrives the victims have no choice but to move, some families get lucky and get 3 extra months to find a new home but by that time the renters are all out of money.
Real Estate Scam: Renting Unavailable Apartments to Unaware out of Towner’s
Most of theses scams happen online and it is nearly impossible to catch the crook. In this scam the con artist will target out of town renters. Most of the renters are college students working to complete their residency program or families who are looking for a new start.
The crook will list a real apartment and then ask the potential renters to wire the money to cover the bogus security deposit and sometimes even the rent.
The unaware renter arrives at their destination and unfortunately finds out the property they rented isn’t actually for rent and have no place to stay.
To make things even more difficult it is almost impossible to trace or recover the money.
Real Estate Scam: How to Protect Yourself From Real Estate Scams
Keep this in mind, “if it’s too good to be true, it probably is”. While in the real estate business you do come across great opportunities we all know that old saying for a reason.
Do your homeowner.
Working with a well-known real estate agent is probably the best way to avoid scam but you need to do your homework first.
Second, make sure the realtor you are working with is licensed. Check as many online reviews as possible. Ask questions.
Third, avoid wiring money or using cash, cash is untraceable and that’s not good, use credit cards and checks. Credit cards and checks could easily be traceable if something goes wrong. Even, if they offer you an invoice and receipt. Insisting on using a credit card or check is usually enough to scare off criminals.