Buying or renting a home is obviously an exciting event, however there are people in this world that like to take advantage of such events. These people are scammers who prey on people’s emotions and take advantage of home buyers, seller and renters. In then end, this can harm your credit scores, finances and require the help of an attorney. Here are some common hoaxes realty wise, so make sure to read and be on the lookout while you home search!
One common type of scam is document fraud. This is when a potential home buyer provides inaccurate information on loan documents. A person may lie about their income, assets or liabilities in order to ensure they qualify for a loan. Also, some buyers may say they want to buy and live in a property, but only want to rent it. Ways to catch this is observe if they list PO Boxes for their addresses for employment or if their income does not match the price of the house in question.
Another type of scam is a foreclosure rescue. This is when people find homeowners who have fallen behind on their loan mortgage payments. The scammers promise to help the homeowner avoid foreclosure but only if they pay these very heavily priced fees upfront. Sometimes, they may require the homeowners to take out another loan on the owner’s behalf, or even have them sign the home over to them. Red flags to look for are people asking for fees in advance or if they are being secretive.
Appraisal fraud is another scam to look out for. This is when a home’s value is inflated or decreased. Keep in mind that appraisers work independently, but these scammers are hired by lenders in order to provide false information on a property. If a home is appraised for more than its actual value, then the homeowner may cash in some of the profits. However, when they try to sell it later down the road, they are left shorthanded. This is easy to avoid if you ask around for an appraiser.
One more common scam is rental scams. One way people are scammed are when they renters agree on a certain property, but later find out that the home actually belongs to someone else. This also applies to scammers who want to sell homes they don’t own. They often target people who speak other languages and do not know too much about the real estate process. These people sign papers and pay money only to find out they do not have the property they wanted.
These hoaxes and scams are pretty common, however you can easily avoid them! Just make sure to work with an experienced and reputable realtor!