As the real estate industry continues to expand, the number of investment and business opportunities and scams targeting those vying to join in the market increases.
Keep in mind that it’s your responsibility as a home buyer to protect yourself and your money from fraudulent dealings in the housing market. Because nothing is more distressing than falling victim to a real estate fraudster, it’s best to ask for assistance from a legit and reputable real estate agent. They’ll help and provide you with resources like their guide for a smooth buying transaction.
While considering hiring a legit real estate agent, here’s a breakdown of the most common real estate scams along with some tips for avoiding them. Continue reading to learn more.
- Real Estate Wire Transfer Scam
Real estate wire fraud is a widespread type of crime that can be committed online. This type of scam frequently targets homebuyers as they proceed through the process of purchasing a home.
Scammers can use email and other forms of electronic communication hacking to gain access to personal information such as bank accounts, social security numbers, and more. Electronic mail and texts are examples. Knowing this allows criminals to intercept transactions and steal hundreds of thousands of dollars.
In the event that you receive wiring instructions for a home purchase through email, DON’T PROCEED. Your real estate agent or title company should be aware that email isn’t a safe way to send financial information.
To avoid wire transfer fraud, you should:
- Never send financial information through email. Generally, email isn’t encrypted. Never trust email requests for wire instructions.
- Meet with your trusted real estate professional or title company contact to talk finances and confirm the account name and number. Be wary of any email, text message, or phone contact suggesting a last-minute change to your wire transfer account number.
- Be careful before opening attachments, accessing email links, or downloading anything, no matter who supplied them. These files may include malware that weakens computer security.
- Update your computing device, browser, and anti-virus software regularly.
- Contact your bank immediately if you think you may have sent a monetary payment to a fraudster via wire transfer.
- Duplicate Listings
It can be alluring to try to find a house on your own without the help of a real estate agent in a competitive housing market by browsing web listings.
The fast-paced nature of the market has sadly been exploited by a large number of con artists who are benefiting from it by placing multiple listings for the same item. Scammers in this scheme steal real estate listings from reputable sources and then re-post them on their own websites, often at high markups.
Homebuyers hoping to get their hands on a bargain on their dream house could be duped into wiring money to bogus owners. By confirming the owner’s legitimacy, you can avoid falling victim to this type of scam. Find the name and contact information of the owner by searching the property data source of your city or county, which is usually available online.
Avoiding this trick can also be done in part by dealing with a reputable real estate agent. Using the services of a real estate agent can help you find affordable properties that suit your needs and guarantee that you are not taken advantage of. Moreover, good real estate agencies will also fully clarify everything you agree to. Don’t work with someone who won’t do that.
- Pre-Selling Scam
One of the most popular types of real estate fraud is the ‘pre-selling’ scam. Dishonest development firms that don’t have the proper permissions or that otherwise exploit the system are responsible for this. Developers typically provide cheap financing rates and other enticing incentives to potential homebuyers during the pre-selling phase.
It’s important to research the developer by reading reviews and testimonials they’ve received online. Customer testimonials are a great means of assessing the quality of a company and can be found on the websites of any respectable enterprise. Prepare a short list for home inspection too.
If you think you have been victimized by a real estate scam, you should notify the law officers in your area the soonest.
Conclusion
Scams involving real estate can be very unsettling but if you’re aware of what to look for you’ll be able to spot a scammer when you encounter one. Check all financial transactions thoroughly and make sure everyone’s identity has been confirmed. In the event that you need to go back and register a complaint to the proper authorities and channels, having a detailed record of all transactions is essential.
