Scams in the Real Estate Industry

As you may already suspect, real estate is a quite profitable industry. It is a worthwhile industry to invest in, for obvious reasons. It is an industry that comes with big opportunities for investment and great returns. Shelter is a basic need hence the buying and selling of properties will remain as long as humans continue to exist. In fact, if you are reading this article, I can make a guess and I will almost be correct. You are likely either going to rent a property or buy one in the near future; that’s if you have not already done so or you come from a wealthy background and you are granted access to a property rent-free.

The abundant opportunities available in the real estate industry come with their risks and hazards. It is an industry of businesses prone to scams. Criminal minds tend to prey on innocent investors using creative and malicious tactics to swindle them of their money. If you are already involved with the industry or planning to invest therein, there are a couple of scams you should be conscious of and they will be examined in this article.

Popular Real Estate Scams in the 21st Century

Duplicated Listings

This occurs when scammers scavenge the internet for images of property listings and then repost these images elsewhere presumably for a lower price than it was originally listed by the real seller. The lower price will likely attract the attention of prospective sellers who may then be persuaded to pay to the scammer. These fake listings may be posted on sites like Craigslist or any available online portal with regular visitors. This type of fraud seems so coordinated that it may take a while for the victim to realize. However, the antidote for this is to always avoid paying for properties advertised by unknown persons but rather to go through established real estate companies.

Impersonation

This is another scam you should be wary of. The norm appears to be for scammers to operate anonymously but this is not always the style. Sometimes they can come out in person to impersonate real estate lawyers. Make sure not to give out any keys to your property without guarantees of who you are dealing with. Don’t be easily swayed by the presentation of online evidence of identity such as a LinkedIn profile or any social media validation. These types of credentials can be easily falsified and therefore carry little significance. If you gave your key, and are in any doubt, do not think twice about changing the locks. Local Locksmiths show up within 20 minutes and can do it on the spot for a low cost, nothing compared to having the house emptied by burglars. Alternatively, frausters may also impersonate any of the parties involved in the transaction being negotiated with the aim of facilitating quick closure of the deal and directing the proceeds to themselves. Scams in real estate tend to be organized so always be sure of the identity of individuals you are dealing with. If there is any request for payment to be made to another account contrary to the earlier agreed account then ensure to hold off payment pending confirmation of who the owner of the account really is.

Escrow fraud

This occurs when scammers hack the website of a real estate company and then access their database, study it, and clone the website and their payment details. They identify from the database the prospective clients currently negotiating a deal or about to finalize a purchase and then send their own payment details to them with different payment details to the one issued by the company. In this case, it is recommended that the individual should refrain from assumptions and endeavor to deal with the details contained in the original documents forwarded by the company. If these details suddenly change even if seemingly negligible, don’t concur until you confirm directly from the company. Refuse to be persuaded by any agent trying to sway you into making the payment quickly. It might just be a fraudster scheming to make away with your money. There is a lot of valuable information at the Escrow Fraud Prevention homepage.

As a prospective real estate investor, never refrain from doing due diligence on any property you are interested in. When you obtain the property whether a rental or outright purchase, ensure to use the services of a real locksmith to secure the property. Do not be tempted by listings with prices too good to be true especially when advertised by individuals without a verifiable office address. Do not be hurried into a purchase and if possible, you could use the old school method by making your payment in the office of the realtor and even this should be done after their identity has been ascertained. Always communicate through established channels and if you feel any suspicious activity, ensure to raise alarm or seek clarification. It’s your money and you should ensure it is properly safeguarded. Following these tips will ensure you do just that.