5 Most Common Real Estate Scams

Posted by Ed Walden on Monday, May 22, 2023 at 10:03:07 AM 

Today, I want to talk about the five common real estate scams that are going on in the market right now.  We're getting to our busy season and it's time to bring awareness to these so that you know what to look out for:

1. Loan flipping: Predatory lenders convince homeowners to refinance their homes multiple times, charging higher fees and costs with each refinancing. It's advisable to work with trusted professional lenders.

2. Foreclosure relief: Scammers claim they can save homes from foreclosure or reduce mortgage payments for a large upfront fee. Homeowners should be cautious and avoid paying upfront fees without verifying the legitimacy of the service.

3. Fake listings and rental scams: Scammers create fraudulent rental listings, often using legitimate property information from MLS listings, and advertise them on platforms like Craigslist. They ask for payment upfront without the intention of renting the property. It's essential to verify the legitimacy of listings and deal directly with reputable property owners or real estate agents.

4. Bait and switch movers: Some moving companies provide low estimates to attract customers, but once they have possession of the belongings, they demand significantly higher payments, claiming unforeseen circumstances or additional work. It's important to research and choose reputable moving companies with transparent pricing policies.

5. Escrow wire fraud: Scammers monitor communication channels for wiring instructions during real estate transactions. They then send fraudulent emails with altered wiring instructions, diverting the funds to their own accounts. To prevent this, it's crucial to use secure email channels and always verify wiring instructions by contacting the intended recipient directly via phone or in person.

Being vigilant and working with trusted professionals can help protect against these scams. If you encounter any suspicious activity, it's recommended to report it to the relevant authorities or seek advice from local law enforcement or real estate professionals.