Scammers are on the rise – how can you protect yourself?
Consider this – you are a property owner of a certain piece of property. It’s raw land, and your primary residence is not in the same town as this property. You get a call one day from a neighboring property owner asking if you are selling the property because a real estate sign is in the yard. Your heart stops. You haven’t contacted anyone to sell your property. The real estate agent has been scammed into believing the property owner wanted to list your property. You contact the agent and have the sign removed. A few weeks go by and another real estate agent’s sign is on your property. It’s happened again! This is a real story, and there are more and more episodes of this happening. In one case, the deal went all the way to closing before the scam was detected. So how can you, as a property owner or a realtor, protect yourself or your clients? Here are some tips and red flags:
- Anyone who wants a quick sale and cash buyer.
- If the seller is pressuring you to act quickly.
- If they demand proceeds must be wired.
- Any seller who refuses a realtor sign on the property.
- Inability to produce proper documentation or any form of identification.
- Only wants to communicate through social media or other apps.
- Is out of town or out of the country and is difficult to communicate with.
- Reveals it isn’t their property but claims they have power of attorney to sell it.
- If you are suspicious of fraud, make sure you are using a local title company and let them know of your concern. Scammers will often want to use their own notary or attorney.
- If the seller is out of town, require the documents be signed in front of a vetted and personally known notary OR send them to a local attorney or title company.
- Verify the seller through an independently retrieved phone number (Forewarn is a great tool for this).
- Verify the seller by sending a letter to the address listed on the tax records.
- Ask the real estate agent if they have verified the seller’s identity.
- Require the seller to verify their identity through a third party provider.
- Ask the seller a lot of questions about the area or their ties to the property that might not be gleamed from the public record.
Don’t rush to the closing table. Ensure you have a purchase agreement in place with multiple safeguards for the buyer including a due diligence period, appraisal, and financing contingencies if applicable. Do a proper title search and exam. The more eyes you have on the transaction, the more likely you are to receive a clear title and a valid sale.
See you at the closing table!
Anne Elise Doise
Attorney At Law