Top Three Real Estate Scams to Beware of

Buying a home brings excitement and unfortunately, chances of getting scammed too. Scam artists often take advantage of buyers’ curiosity to get a new home and trick them into paying for properties that mispresent the deal’s terms of real estate financing that don’t even exist.

Luckily, there are many helpful ways to avoid buyers falling into a scam. By learning about the most common real estate scams, it becomes easy to protect yourself from them.



Define Real Estate Scam

Fraud takes place when a scammer represents himself as a real estate agent to loot your money. The most common scams are mortgage frauds. It occurs when loan brokers or shady lenders promote misinformation to get money from innocent borrowers. Anytime information is falsified on a home loan application, which is a mortgage scam instance. Do your homework before opting for real estate loans and investments and avoiding scams.

Here are common three real estate scams to beware of-

1.    Foreclosure Relief Scam

Fraudsters will target people on the brink of having their residence closeout. An organization may promise out to either stop the foreclosure or reduce their mortgage payment for a large with an upfront fee. Then they leave homebuyers in worse financial conditions, where they neither get their money back nor relief in their mortgage loans.

2.    Escrow Wire Fraud

Scammers set up fake websites that seem exactly like a lending company you are working with. They use spoofing tactics to make email addresses, phone numbers, and websites appear familiar to you. What you need to consider here is don’t fall for how well it is written, and before sending money to a third party, call on numbers mentioned in the original document and verify if provided mail or website is true or not.

3.     Loan-flipping

Scammers will convince targeted individuals to refinance their homes frequently, charging points and high fees on each transaction. In the end, the borrower will end up with high loan payments they can’t afford and limited equity in their home. Thus, one should work with lenders who are credible and known.

To avoid real estate scams, here are some tactics to follow-

  • ·   Confidential Personal Information: Never share your personal information with any random person.
  • ·   Licensed Professional: Work with trustworthy and authorized real estate professionals.
  • ·   Avoid Upfront Fees: Do not pay any fee until not sure.
  • ·   Be Vigilant of Last-minute Changes: Amid the process of home buying, be conscious of last-minute changes.
  • ·   Neglect Off-market Transactions: Never go for off-market transactions even with good deals. Real estate scams are a reality for which you need to be aware and don’t fall for them. If you believe you have got trapped in scams, call the authorities instantly.

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