Investing in real estate is a significant decision, and should not be taken lightly. Purchasing a home, office space, or investment property is a big deal, and generally requires quite a lot of capital. Unfortunately, there are fraudsters out there looking to con people out of their hard-earned cash, and they often do it through real estate fraud.
If you or a loved one is considering investing in real estate, then make sure you know the most common real estate fraud red flags:
- Seller requiring some sort of payment before the buyer ever sees the property. Never part with your money before you have at least been given the option to visit the property you are considering purchasing.
- The pressure to act immediately. Real estate transactions can be handled very quickly, but this is not a decision that should be rushed into…especially when a seller is laying on pressure.
- A general lack of paperwork or paperwork that has been poorly edited. Make sure to both have yourself, and a real estate attorney review all of your purchase documents.
- Sellers who want you to make mortgage payments directly to them. This is a common scam in which sellers never actually take out a mortgage for the new owners, but instead just pocket the money and leave the buyers in a lerch.
Above all else, if you sense smoke but cannot find a fire, trust your gut and back out. Real estate fraud can be absolutely devastating, so do not get involved in something you are very confident in.