Courtesy MLSListings – October 10, 2014
The Internet has made it easier for consumers looking to rent or buy a home to bypass using a REALTOR® and go directly to the source of property listings and negotiate with the owner or property manager. Unfortunately, this can pose significant risks with the widespread problem of real estate scams. This is particularly prevalent on sites like Craigslist where unsuspecting renters and home buyers go looking for great deals and ideal properties. What they can end up with is identity theft, theft of funds and even serious physical harm.
The most common scams are those designed to get you or your client’s personal information or get access to your money. Someone purporting to be a landlord or property owner lists a property, but doesn’t actually have the authority to rent it or sell it. They may be a current tenant or they might have even stolen the keys to the property to gain access. You show up and they give you the tour, you love the place and sign the offered paperwork, you hand them a check and get the keys – only to find too late that the transaction was completely fraudulent.
Another scam targets getting your personal identity and banking information. The property listing may appear very genuine and in order to learn more about the property and schedule an appointment to see it, you are required to provide detailed personal information and proof of financial resources. Before you know it, the listing and the scammer have disappeared, along with your identity and/or your money.
How can you spot a scam? Here are a few red flags.
- An unrealistic price for the property
- A request or requirement to wire money for the transaction
- A request for an unusual amount of personal information up front
- A lengthy or convoluted explanation for why the property is on the market
- Conflicting listing information or information that doesn’t match up with the listing details or photos
There are a number of things you and your clients can do to protect against fraudulent real estate listings:
- Make sure you are dealing with the actual property owner. If they claim to work for a real estate company, call the office and check them out. If they are claiming to be the owner or landlord, Google them or do other investigative work to confirm they are legitimate.
- Guard your personal information. Do not provide anything more than basic information (your name and phone number) prior to seeing a listing. You should not be asked to hand over any funds or detailed financial or personal information in order to see a property.
- Do not view a property alone. A prospective buyer or renter should always be accompanied by a real estate professional, and real estate professionals should always take someone with them to tour a property, and/or alert someone where they will be and at what time.
- Do your homework on a property you’re interested in. Before scheduling a property tour or viewing, research the landlord or listing company to verify their legitimacy. Use Google Maps to verify the address and property exists.
Educating your clients about the problem of real estate scams can help to save them from potential disaster, and it creates an opportunity to discuss the value that working with a real estate professional can provide. Public sites like Craigslist will always attract legitimate sellers and landlords, as well as unscrupulous scam artists. It’s important to stay on top of this type of fraudulent activity and protect yourself and your clients.