Protect Yourself From Real Estate Scams Online

Posted on May 4, 2008


The real estate market is awash with brokers, middlemen, and agents who, mostly are professionals and legitimate dealers. However, like most markets and businesses, there are a few rotten eggs, who will do anything just to profit, by fooling hapless customers.

Being a real estate investor means protecting yourself from potential scams and rip-offs. Be aware that just because someone holds a professional license of some kind doesn”t mean that he is honest. You can probably order one of these licenses over the Internet, or ask someone to forge them.

Know When To Raise The Red Flag

The internet is a tremendously large repository of information, and for real estate investors, a potential minefield for scams and potential rip-offs. Online clients should use extreme caution when replying to email requests about your property for sale. If the e-mails initially look suspicious, immoral or illegal, it probably is. Consumers should learn to raise the red flag when these warning signs show up, and here are a few examples:

- If the person/agent/broker sends you an email saying they want to “buy your house”, without even seeing your home. It is noted that around 99% of buyers want to see the home or other real estate before making offers.

- If an email asks you to “deposit funds” or “send a check” before even seeing your home.

- If you do an Internet search on the phone number they give you, and the number traces to an Internet Cafe or other suspicious information turns up.

- If the person is from a country other than the United States. Be aware that the majority of people who have tried to these types of scams are from the UK, with others from Italy and Nigeria.

How To Protect Yourself From Online Real Estate Scams

It is a byword for a responsible real estate investor to never, under any circumstance, give out personal or financial information, this would only be necessary when closing the deal is already set. If the person e-mailing you wants to know “whose name the ownership is in”, “is there an insurance certificate”, or “are you a US citizen”, etc, beware of these people.

It is also imperative that you know who you are dealing with. Do this by confirming the buyer’s name, street address, and telephone number. Search the internet for the name and telephone number. You may find some enlightening information from doing a quick search on Google, Yahoo or MSN. To add, avoid dealing with people from outside the United States, if possible. You should know that you have very limited rights or protection with dealing with persons outside the USA. Should you accept payments by check, ask for a check drawn on a local bank or a bank with a local branch. You can visit that bank branch to verify if the check is legitimate.

You should be aware that there are a lot of fake cashier’s checks and money orders and banks may unknowingly cash them and hold you responsible when the fake is discovered weeks later. And also, never accept a check for more than your selling price. The buyer offers to pay more than the asking price and wants you, in return, to write a check for the difference. Their check will most certainly bounce and you will be responsible for paying the bank penalties.

Real Estate Press - http://realestatepress.org

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