It’s a common misconception that real estate scams only target seniors or uneducated buyers. The truth is it can be easy for anyone to fall for a scam, even with some familiarity about the home buying process. Buying a home for sale in Irvine, CA, can be stressful, but the last thing you want is to find out you have fallen for a bait-and-switch scam or have lost your down payment. Here are 5 common real estate scams to watch for.
1. Mortgage Closing Scam
Your closing date is approaching and you receive an email from your agent with instructions for wiring your down payment. You follow the instructions and later hear from your agent with different instructions for bringing your down payment to closing when you sign paperwork. It turns out you wired your money to a stranger who accessed your agent’s email. This scam is so nefarious because it seemingly comes from your real estate agent or your escrow agent. When hackers get access to email accounts, they can see when closing dates are approaching and email buyers at the right time to seem legitimate. To avoid this scam, always verify communications with your agent over the phone or in person.
2. Fake Duplicate Listings
A frequent scam involves duplicating legitimate listings and posting them on websites like Craigslist with a lower list price. The homes are often advertised as For Sale by Owner. People who fall in love with these duplicate listings and their too-good-to-be-true prices may contact the seller and end up handing over earnest money or a down payment for a home the seller doesn’t actually own.
3. Tenants in Your New Home
You close on your new home and get ready to walk in for the first time only to discover your new key doesn’t work. Someone comes out to find out why you’re trying to enter his or her home. In these cases, the supposed tenants are likely victims as well. This scam happens when someone advertises a vacant home for rent. They create a lease, accept a down payment, and provide keys, but the renter finds out that someone else (you, in this case) owns the home. Sometimes these situations can be cleared up easily, but if they have already moved into your new home, you may need to go through an expensive eviction process. The best way to avoid this scam is finding out if the home you’re buying is listed as a rental property, asking if anyone is checking on the home regularly, and negotiating regular visits to the home to ensure the locks still work.
4. Agent’s Guarantee to Sell Your Home
You may see some real estate agents advertising that they guarantee they will sell your home or they will buy it themselves. This bait-and-switch scam comes with many stipulations and it’s usually a bad deal. You typically must agree to a specific asking price for your home along with pre-set price drops every month. You may also be required to buy your new home through the same agent and even choose among homes the agent’s firm has listed. The agent will only buy your home for below market value. The goal of the scam isn’t to get you to agree to the terms. Instead, once you realize the terms are outrageous, the agent will switch focus and recommend just listing your home in the regular way. Don’t fall for sales gimmicks. Choose an experienced and highly rated real estate agent you feel comfortable working with.
5. Moving Company Hostage Scam
Another common real estate scam happens when trying to move into a new home. You do your due diligence and find a moving company with a good rating and a fair price. Once your home is packed up, you receive a new bill that’s double what you were quoted. Until you pay the new amount, your belongings are held hostage. This scam can be difficult to avoid. Always check into any moving company you hire by checking their Better Business Bureau rating and customer reviews. Be suspicious of pricing that seems too good to be true, as it may very well be a scam. You can also hire movers to pack your belongings into a rental truck you will drive so you remain in control of your belongings.
Watch out for these and other scams when looking at homes, townhomes, and condos for sale in Irvine, CA. One of the best ways to avoid getting scammed is to work with a trusted real estate agent from Irvine Residential Living. Give us a call today at 714-454-6304 to begin your search.