No one wants to fall for a real estate scam because it is both financially and personally devastating. There are tons of scams to watch out for, so it is important to know how to identify some of the most common ones. We’ve curated a list of some of the common real estate scams and some places for you to find more information to ensure that you’re educated when conducting real estate transactions.
Biggest Real Estate Scams
With the rise of the internet, real estate scams are easier to pull off than they used to be, leading to these issues being relatively widespread. There are tons of scammers who will put out posters or ads to get your attention; this flashy use of advertising makes it important to know how to spot what’s real and what’s fake.
This type of real estate scammer preys on people who are at risk of losing their home or who are going through the process of being foreclosed on. They charge their victims money under the pretense of being able to save their home- however, this is completely false. Real help is available and free.
There are scammers who copy existing real estate listings and post them on scam websites at a lower price. This often includes wiring the money on a home that you haven’t seen before because the price is amazing. Be wary of a home on a website like Craigslist – a reverse image search is always a good idea when something seems suspicious.
Another caution for people involved in real estate investing is that sometimes these false listings will target people who intend on selling to buyers who flip or resell homes. They list these fake homes and hope that investors will come along wire money to them sight unseen.
This scammer lets a buyer think that they’ve made an appointment to see a property that they’re interested in, only to tell the buyer at the last minute that they “had something come up” and can’t show it. There’s really no point to this scam. Why would someone go through the time and energy to set up and cancel a fake viewing? Who knows, but there’s a scammer for just about everything.
A person selling their house might get a message that they need to wire the escrow money to a certain place. These scammers target people they know are buying a property and pose as the title company handling the transaction. Always verify you’re dealing with the correct title company and don’t put confidential information in e-mails.
A good way to avoid this is to verify the contact information before sending sensitive data. Check that the phone number or email address that contacted you belongs to the company you are working with and if it doesn’t match up contact your title company to let them know.
This scam is becoming more and more prevalent, especially targeting companies or individuals with “realty” in their e-mail address. Be on the lookout!
Signs of a Scam
Knowing the signs of a scam before you invest is important in avoiding any type of scam.
Wiring Money Before You’ve Seen the Property
This might seem like a no-brainer, but a lot of people fall for this because the scammer is very persuasive. Scammers try to convince you with there’s no time to see a property because of the competition for it. This sense of urgency over a “great piece of property” at a “great price” often is just a play on emotions.
If anyone tries to push you into wiring money before seeing a property, cut ties and think about reporting these people to the appropriate government agency. Reporting these scammers is important because it ensures that other people won’t fall for the scammer’s scheme.
Feeling Pushed or Rushed
Obviously, some sense of urgency is important in making decisions, but if you’re working with an overly pushy person, that’s an issue. If they’re pushing you into making a decision not comfortable with, it’s best to do a little research on them.
If someone’s website looks fishy and information doesn’t add up, do a little more research. Websites should have information on locations where the business is located and contact information.
Our website has an “About Us” page, which is easy enough to fake, but with a few clicks, it’s easy to tell we aren’t fake. This goes for other websites, as scammers aren’t going to use their own faces.
Doing a reverse image search on the site is a good place to start when checking for a scam. Scammers sometimes steal their “About Us” page from other legitimate websites. Googling some of the exact text on the “About Us” page can help identify if it’s real.
Check the Better Business Bureau and other reputable websites to confirm the individual or company you’re dealing with is legit. Check out reviews and call references. Doing your due diligence will reduce the likelihood of you falling victim to a scammer.
As technology advances the real estate scams seem to get more complicated too. It’s important to know the general set up of these scams so that you can recognize them in the future. We hope this list has helped educate you and helps you along your real estate journey.
If you’re interested in looking into our company but are wary of all these scams, a good place to start is contacting us or checking out our website. We’re willing to answer any questions that you might have and make sure you have all the information you need.