Being a homeowner is one of the biggest financial decisions you will ever have to make. Sadly, there are a lot of scams and frauds in the real estate market that can absolutely ruin owners’ lives. It’s important to be aware of possible fraud and take the steps you need to protect yourself when buying your first home, an investment property, or a vacation house. We’ll give you a full list of things to do to avoid real estate scams in this blog. You are less likely to fall for a scam if you follow these steps. The deal will also go more easily and safely.
Find out as much as you can about the house.
You should find out as much as you can about a house you want to buy before you offer or agree to a deal.
Check the records of who owns.
One of the first things you should do is find out who owns the land. Bad people sometimes use fake papers to make it look like they own places they don’t really do. You can find out about public property online or at your local land record office. The person selling the house will be more likely to have the right to do so if they do this.
Read up on the past of the property.
Find out about the property’s past sales, cases, liens, and any bills or liens that are still due. If the property has had a lot of problems with ownership in the past, that could be a sign of trouble. If you are behind on your mortgage, property taxes, or court cases, find out what you need to do.
See how much the property is worth.
People often get ripped off by properties that are too good to be true or too expensive. To avoid this, use an online tool or talk to a reputable expert to get a good idea of how much the house is worth on the market. You should find out more about a price that seems too good to be true.
Get a real estate agent you can trust.
The best way to protect yourself from scams is to work with a real estate agent you can trust and who has a lot of experience. A good real estate agent will help you every step of the way and keep you from making mistakes like believing fake ads or buyers who aren’t who they say they are.
Check their credentials.
Check an agent’s qualifications before you work with them. Make sure the people you hire are licensed and have a good reputation in the business. Check with area consumer protection agencies, real estate boards, or groups to see how they are known.
Ask for suggestions
Ask friends, family, or coworkers you know who have bought or sold a house and had a good experience for recommendations. If an agent has a good name, they will be happy to give you references or testimonials from past clients.
Look for warning signs in the listing
A lot of real estate scams begin with property ads that aren’t what they seem to be. Keep an eye out for these things:
Not Clear Property Information
A real property listing should have clear and complete information, like the location, the number of rooms, the square footage, and pictures of the property. Watch out for ads that don’t give enough information, have bad pictures, or don’t have clear descriptions.
Prices That Are Too Good to Be True
Properties that are listed at ridiculously cheap prices are often used in scams to get people to buy them without knowing what’s going on. It’s likely that an ad is fake if it seems too good to be true. If the prices are low, it could mean that the house has secret problems or that the seller is trying to get quick buyers to pull off a scam.
Need or High Pressure
Scammers often use a sense of urgency to get people to move quickly. Avoid making a deal with someone who says the deal will only last a short time or says they will sell the property to someone else if you don’t agree right away.
Make sure you know who the seller is.
It is very important to make sure that the person you are dealing with really owns the land. This can stop scams where con artists pretend to be owners.
Ask for proof of identity
Always ask the seller to show you a legal form of ID, like a government-issued ID. Check this with the public records to make sure that the name on the title fits the person you are dealing with.
Watch out for overseas sellers
If the seller says they live abroad, be very careful. Even though foreign sales happen all the time, fraudsters often use this method to avoid meeting people in person. Before moving forward, make sure that all communications and paperwork are real.
Hire an experienced real estate lawyer
There is a lot of legal paperwork that goes into real estate deals. Hiring an attorney to look over the papers can stop deals from being shady.
Carefully look over contracts
A real estate lawyer will carefully read the sales contract to make sure that all of the terms are fair and correct. Also, they can spot red flags like strange terms or hidden fees that could mean the deal is a scam.
Title Lookup
Your lawyer can help you do a title check to make sure that the seller really does own the house and that there aren’t any liens or legal issues on it. This step is necessary to make sure that the property doesn’t have any liens on it.
Get financing from lenders you can trust
Fraudulent lenders who offer fake or misleading loan products are another type of real estate scam that can happen besides the seller. To keep yourself safe:
Pick well-known lenders.
Only work with banks or mortgage agents that you know you can trust. There are people who offer deals that seem too good to be true, so stay away from them. Always look into the lender’s history and read what other customers have said about them.
Rates that seem too low should not be taken seriously.
It’s important to get a good interest rate, but watch out for deals that offer rates that are much lower than the current market average.If the dealer says this, it could mean they want you to sign a bad deal.
Carefully check out the house
Often, people who commit real estate scams lie about what’s going on with the property. If a house is promoted as being in great shape, it’s possible that it has problems or needs expensive repairs that haven’t been mentioned.
Get a professional to look it over.
Before signing the papers, you should always hire a professional inspector to do a full check of the property. The inspector will look for problems with the structure, the electricity, the pipes, mold, and other things that could cost you a lot of money.
Pick up a home guarantee.
There’s a chance you can get a home warranty from the seller that will cover repairs for certain home systems and items. If you buy a house, this can help you relax in case there are hidden issues after you’ve bought it.
Buy things with safe methods
As a buyer, you should always check the deal with the seller before sending money. So they don’t get caught, thieves often ask for money through wire transfers or other ways that can’t be tracked.
Get trust accounts set up.
Keep your money safe by using a trust account. There is a third party, like a lawyer or title company, who holds your deposit or payment in trust in an escrow account until the purchase agreement is fulfilled.
This makes sure the seller can’t just take your money and leave without giving you the property.
Don’t pay with cash.
When buying or selling a house, don’t pay cash. Dealing with someone who only wants cash is a big red flag. Always choose a safe way to pay that lets you keep track of your money, like a bank transfer or check.
Listen to your Instincts
Trust your gut if something doesn’t feel right during the process. A real estate deal costs a lot of money, so you should never feel rushed or pushed to make a choice. If you feel nervous or see something that doesn’t make sense, you can back out of the deal.
Last Thoughts
Real estate theft can be scary, but if you follow this buyer’s checklist, you’ll be much less likely to fall for a scam. You can feel confident in the real estate market and make a safe, successful buy if you do your homework, work with professionals you can trust, and take the right safety measures.
Remember that you are less likely to be scammed if you know more about it. Watch out for things and take your time to make the right choice. Tomorrow you’ll be glad you did this!
