Types of Real estate scams and how to Avoid

Bangalore:  In today’s market, Real estate Scams and Frauds are flourishing at all levels of the real estate market, it becomes trickier to identify. When the opportunity seems to be good and true, then it is very hard to find out the rightful opportunity. It is very imperative to choose a right property that you are buying and the person from whom you are buying. Hiring a reputable real estate broker and appraise of vigilance is the best way to avoid real estate scams and frauds, but there are few other scams that you can avoid by using common sense. Here is a rundown of few common real estate scams and ways to be free from being scammed.

Title Fraud:

Title fraud is one of the destructive types of real estate scam for property owners. In this type of fraud the person steals identity and uses bogus documents to sell real estate property or to get a new home loan against property. After getting a loan, the scammer takes off the cash and leaves the future payment burden on the owners head.  

The best protector for this type of Real estate scam is Title insurance as it safeguards from encroachment issues and errors in public records. Another key to protect is to employ in protection of personal information. Precautions can also reduce the mistakes.

Rental Scams:

Most people start their house hunt through internet; this is the big advantage for real estate scammers. In this type of real estate scam, criminals pose as real estate agents and pull the online rental listing and repost on another site on their names. Usually, they will offer for less cost and they will ask security deposit upfront, in addition they will offer fake rental document. This is too dangerous because the buyer not only lose the deposit amount they can also lose their identity as the criminal has clear information on rental agreement.

This is a common major scam in the real estate market. To avoid this real estate rental scam the property owner can do something like searching addresses of their units on SE (search engines) like Google image search and they should watermark the photos they use in listings including contact numbers.

Foreclosure and home-equity fraud

In this type of fraud/real estate scam, criminal enterprises take an advantage of homeowners who are struggling to pay their mortgage payments. In exchange for a lower monthly payment and a consolidation loan, the homeowner pays upfront fees and transfers the agreement of property title to a new lender.  Then the real estate scammer keeps all the payment made by the owner and sells the property without the property owner knowing.

When leveraging properties, there is always a risk. The owners looking to borrow on equity should be vigilant for less conscientious lenders such as those who invite owners to adorn their document by embellished income and property assessment value sources to secure larger loans.

While investing, do some basic research on property which you are going to buy like owner name - land title research, older transactions, mortgages and liens to avoid real estate scams. Don’t share your documents and hire a reputed real estate agent to protect yourself from frauds/real-estate scams.