Regrettably, the real estate industry is not immune to individuals looking to exploit vulnerable consumers for financial gain. Scammers often target buyers and sellers, leading to significant financial losses due to the high value of real estate transactions.
To protect yourself, it is crucial to stay informed about the latest scams prevalent in the market. Understanding the tactics employed by these malicious actors can help Edmonton residents avoid falling victim to fraudulent schemes.
Be Cautious with Large Cash Deposits or Down Payments
Unfortunately real estate is a common vehicle that buyers can use for illegal activities such as money laundering. Be wary of extremely large deposits or down payments that are all cash. This is something that should be flagged by your lawyer, but it’s important for you to also be aware of this issue. Additionally potential Edmonton home buyers and sellers should be cautious of cybercriminals who target real estate transactions. These hackers may compromise an agent’s email account and send falsified instructions, directing unsuspecting individuals to wire funds to fraudulent overseas accounts.
Best Practices to Avoid Getting Scammed
Here’s a few best practices we recommend:
- Have a Real Estate Lawyer on your side, and have them take a look at the buyer’s “Offer to Purchase” contract to make sure there isn’t any wording in there that could throw things off. Additionally you will need a lawyer on your end anyways in order to close the sale, transfer the funds, and transfer the legal title of the property – so reaching out early to have them take a look at the contract is always a helpful piece of due diligence to give you more peace of mind.
- Get an idea of what your property is worth before getting offers. This will minimize your likelihood of getting low-balled, or accepting an unfair offer. An easy way to do this is by checking the Honestdoor Website for a very basic valuation (however keep in mind these numbers may not be too accurate, since they’ve never even seen the interior of your property), or for a more accurate valuation you can ask a realtor to take a look at your house and provide you with a CMA or Comparative Market Analysis. Most will do this for free for the chance of potentially working with you going forward.
- Lastly you can check the we buy houses companies website & reviews on external websites to get an idea of their level of professionalism and whether they have the appropriate experience. It’s always good to ask questions about how their specific process works and how they may or may not be a good fit to buy your house.
In summary, scammers often target real estate buyers and sellers, leading to significant financial losses. To protect yourself, stay informed about the latest scams and understand the tactics employed by malicious actors. Beware of down payment hackers, who compromise agents’ email accounts and send falsified instructions, directing unsuspecting individuals to wire funds to fraudulent overseas accounts. Be vigilant against deceptive offers that lure sellers into unfavorable deals, pressure them to hastily sign contracts without thoroughly reviewing the terms, and later renegotiate for a lower selling price. Preventing home title fraud is crucial, as it involves identity theft to secure loans against property equity. Investing in title insurance and prioritizing data protection are essential defenses against such fraudulent activities. Research the backgrounds of real estate agents, real estate attorneys, and moving companies to avoid hoaxes and scams. Seek recommendations from trusted friends or professionals in related industries and use well-established and reputable providers.