How To Lookout For Home Buyer Scams
Unfortunately, the home buying process is ripe for fraudsters who want to make a quick buck. If you’re currently searching for a new home, you’re probably concerned about home buying scams and would like to know what you can do to protect yourself.
Here are some things to look out for during the home buying process, and some red flags to avoid!
Wire fraud is one of the most prominent real estate scams that affect buyers. Both you and your agent must take great care when emailing any personal data. It is especially important to never email your bank account details or sensitive information such as your social security number.
If you receive any emails from your agent requesting this kind of information, be sure to call them directly and query why they need it and what it is being used for.
It’s also crucial to double-check any email addresses that you correspond with. If you do not recognize the email, or if it differs from the one you’ve previously contacted, you should cease communication until you have confirmation from the other party.
Do Not Buy Sight Unseen
Sometimes scam artists will place advertisements for homes that don’t exist or ones that are very different to how they’re described. If you see a listing for a home that seems too good to be true, and you’re being pressured to place a deposit on it or pay for it without viewing it — this is a red flag.
Only very experienced flippers and investors purchase homes sight unseen, and even they would likely advise against it. Buying a home is one of the most significant financial purchases that you will ever make, and shouldn’t be made on impulse. It is crucial that you have a professional inspection done on any home you plan to buy – which brings us on to our next tip!
Do Your Due Diligence
Not everything is as it appears, especially when it comes to real estate. It’s very difficult to determine at first glance whether a property has issues that need attention. For example, if a seller decides to paint over a mold problem rather than addressing it, and doesn’t disclose this, you could end up with a very expensive problem after closing day.
Buyers should also ensure that the title of a property is clear, and belongs to the seller, and also that they have a professional inspection to check for any faults or issues with the home.
It’s not just properties that buyers need to worry about when it comes to real estate scammers — there are also people fraudulently masquerading as mortgage companies or brokers.
If it sounds too good to be true, it often is. Companies that promise you suspiciously low-interest rates or minuscule monthly payments for a one-off fee or access to your bank account are unlikely to be legitimate.
You should never respond to unsolicited loan modification offers, and you should always deal directly with a reputable bank or mortgage broker to ensure that you aren’t being scammed.