According to one survey, many people felt that the process of buying a home was more stressful than having a baby, starting a new job or even getting married! While a majority of real estate transactions are 100% legitimate and involve reputable, ethical professionals, there are a small number of “bad eggs” who target the real estate industry. Hundreds of thousands of dollars may change hands in a single transaction so it’s not surprising that the industry is targeted by scammers since the potential payoff is significant. This is one reason why it’s so important to work with a licensed Realtor who can advise you, in addition to offering insight and guidance throughout the purchase and sale process. So what are the most common real estate scams that have been used to deceive some very intelligent individuals? And how can you avoid these scams with the help of a licensed Realtor? Southern Connecticut Coldwell Banker Realtor Judy Szablak will explore this topic in today’s article.
The Real Estate Scam: Wiring to a Con
During the home buying process, there will come a time when money must change hands. This process can leave buyers vulnerable to a scam.
In Connecticut, it’s typical for a real estate attorney to oversee aspects of the purchase and sale process, including the oversight of an escrow account and fund transfers. But this is not the case across the board. There are some instances where you may be responsible for wiring money to another party, perhaps to put down a deposit on a property.
Scammers can target the money transfer or wiring process, ultimately directing you to transfer, wire or send money directly to their account. Sometimes, the scammer may impersonate another party. For this reason, it’s essential that you only send money using traceable methods (i.e. do not send a money order) and always verify the request by phone and via email. Verify that the email and phone number belong to the person whom you believe they belong to. Remember, scammers often use an email address that is very similar to that of a legitimate company. When in doubt, ask questions. Your Realtor is a wealth of information and she can provide you with insight into what’s typical, what’s not and what to expect.
The Scam: If the House Doesn’t Sell, I’ll Buy It
Some less-than-ethical real estate agents have committed this scam, which is often used as a bait and switch technique to get new listings. The offer of a “guaranteed” sale is successful in prompting sellers to contact the Realtor, who typically has some very undesirable or downright crazy stipulations associated with their “if-the-house-doesn’t-sell-I’ll-buy-it” deal. And the offer to purchase the property is typically far below what would be considered fair market value.
Seeing these bizarre stipulations and conditions, virtually all homeowners will decline the arrangement (which is good because in most cases, the real estate agent doesn’t really have any intention of purchasing the property.) But some may not be deterred from working with this individual; instead, they may say “Okay, so let’s list my home under a standard contract.” And the Realtor has succeeded in getting a new client.
An ethical, honest and reputable Realtor would never use this type of bait and switch scheme. So if you were to encounter someone who made such an offer, it would be prudent to find another real estate professional to assist with your home sale. It’s essential that your transaction is conducted by an ethical and experienced licensed Realtor; otherwise, you could encounter serious issues with one of the largest purchases you’ll ever make,
The Scam: Renting a Non-Existent Home
Maybe you’re still saving up to buy your own home and are renting in the interim. Or perhaps you’re buying a house, but it’s not available for another couple months, so in the interim, you seek out a rental. Beware because you could be targeted by a scammer!
Here’s how this scam works: a con artist finds a description and photos of a home. They advertise the property for rent, seeking the first month’s rent, the last month’s rent and a security deposit. The con indicates that he or she is representing the owner, who is currently out of the country. Since the owner is living abroad, your payment must be sent overseas or to another far-off location. Oh, and that money is usually sent via an untraceable method.
But the reality is this: the con doesn’t own or manage the property. They have no right to rent the property at all. So you’ve paid first, last and deposit on a property that was never available. And by the time you realize this fact, it’s too late. The con has run off with your money.
Often, simply confirming the property owner’s name (which is often different from the name you were provided) can reveal the con. You can easily confirm the property owner’s name via public records, available at your city/town clerk’s office or online via a site such as CourthouseDirect.com. Foreclosed homes are often targeted since they’re vacant and the con can even “show” the property, so it’s wise to check with the city/town clerk’s office or online to ensure that the property is not currently going through the foreclosure process.
To avoid any chances of falling victim to this scam, consider turning to a real estate agent to help you find the right rental property to suit your needs and your budget. Your Realtor can be a valuable asset, helping you find the perfect property at the perfect price, while giving you peace of mind that you’re working with an experienced professional who can help you avoid getting scammed!
In addition to targeting potential buyers and prospective renters, scammers have also targeted individual props who are in the process of moving. You hire a moving company with super low rates but once you’re all packed up and ready to roll to your new home, the scam is revealed: the moving company’s rates have suddenly increased and you need to pay the difference before your belongings will be delivered! Out of desperation, you pay because they’ve got your entire life packed up in their truck.
Trust Your Home Sale to a Top Southern Connecticut Realtor
Whether you’re a buyer or a seller, Southern Connecticut real estate expert and seasoned Realtor Judy Szablak is here to offer guidance, helping you avoid scams while ensuring that you enjoy a prompt, efficient transaction. An agent with Coldwell Banker Residential Brokerage, based in Westport, CT, Judy Szablak has been in the real estate field for decades. She specializes in the purchase and sale of single family homes, new construction, luxury properties, condominiums and even seasonal or rental homes.
Serving clients since 1984 and recently amongst the top 6% of Coldwell Banker real estate agents worldwide, Realtor Judy Szablak has more than 30 years of experience working in the Southern Connecticut real estate industry. She works with clients in a number of Southern Connecticut communities, including Westport, Trumbull, Weston, Fairfield, Norwalk, Stamford, Easton, Wilton and Rowayton amongst others.
Browse Judy’s property listings to see if your new home is amongst her listings! Or, if you’re ready to sell your Southern Connecticut home, turn to the best. With over three decades of experience selling homes in this area, Judy knows exactly what it takes to ensure a smooth and stress-free home sale. Call Realtor Judy Szablak today at 203.257.5892.