Fraud and investment scams abound at all levels of the real estate market. Whether it be a contractor who charges hundreds of dollars for work not done to an “investment agent” who embezzles hundreds of millions, protecting yourself can require a measure of vigilance and legwork, but it can also come down to exercising scepticism and common sense.
The real estate market is booming and beaming with profit and is considered one of the most profitable businesses globally. Whether you are a business novice or an expert, one thing that pops into everyone’s mind is to start a real estate business.
Wherever a business resides, there resides a scam. Scammers can be found in each and every corner of the world nowadays. When it comes to real estate scams and frauds, we are dealing with fake properties, over-priced houses, fake material, and houses and also, not forget the hustle in documentation during the entire process.
According to the Federal Bureau for Research’s Cyber Crime Complaint Center, every year, almost 12000 victims report real estate or mortgage theft, resulting in damages of more than 150 million dollars.
Even though property-related scams might be a bit more challenging to identify, one can get their hands on the fraud and the scammers with proper understanding and research.
Some of the real estate scams are:
One of the most common ways of getting yourself into a property related fraud is to seek services from an unreliable source. It is entirely unknown and unpredictable unless you have tried a service before. However, some basic preventive methods can help you avoid this form of scam.
How to avoid it?
Use reliable websites and web sources to look at the property and hire a real estate agent. Many people choose to go with people who have the designation of Realtor in front of their name. This means that they are authorized by the governing body to run this business.
Look for the website because every verified and authentic business likes to have a website and a properly running corporate office to make their potential clients feel secure with their investment.
Although relatively rare, one of the most devastating frauds for property owners is title fraud. This type of fraud starts with identity theft. The scammer will use false documents to pose as the property owner, register forged documents transferring a property to their name and then gets a new mortgage against the property. After securing a mortgage or line of credit, the criminal takes the cash and leaves the owner on the hook for future payments.
While an identity thief may get a forced discharge of an existing mortgage, it is generally held that fraudsters are more likely to go after homes that are free and clear of mortgages: these have fewer complications, and they tend to be held by older people who may be less aware of how to guard against identity theft.