There are many different types of traps you can fall into when speculating on real estate, and unless you know what to look out for it’s easy to become a victim. Manipulators usually depend on the victim’s inexperience or willingness to buckle under the hard sell, but real estate is often different. That’s why the best defense is to be aware of what can happen and to take preventive action.
Hacked Email Accounts
You’ve looked and looked and you’ve found your dream home. It’s almost yours. The one thing left is to make your down payment. Your real estate agent sends you an email telling you where to wire the money. Everything’s looking good. There’s just one problem.
You’re about to fall victim to the mortgage closing scam. How does it work? It’s fairly simple, but it’s effective. A hacker accesses your real estate agent’s email account, or the account of someone else involved in the transaction—your lawyer or mortgage banker, for example. The hacker then emails you instructions where to send your payment—but that bank account belongs to him, not your seller.
It’s easy to fall for the scam since you readily identify the email address. In many cases, you’ve already agreed to pay by wire. What can you do to avoid becoming the next victim? One solution is to pay only face-to-face. That way, you know exactly to whom you’re giving your money. That way, should you receive an email informing you of a change in the payment arrangements, you will know you have to confirm it by phone. But don’t call the number in the suspicious email, which probably belongs to the scammer!
Squatters Move in to Your Dream Home
Here’s another variation on the theme. You’ve completed your payment and are now ready to take possession of your home. You walk up to the house and, to your amazement, someone is already living there.
This scam operates in one of several ways. It may be that someone who saw that the home you purchased has been vacant and advertises it for rent. The scammer pretends to be the landlord, changes the locks and keys and “rents” out your property. In this case, the renter also has been scammed, and if he doesn’t agree to get up and go, you will now need to initiate legal proceedings to evict him.
The same thing can happen without a fictitious landlord. Anyone who sees the house has been vacant can break into it on his own and hunker down until a law enforcement officer drags him away.
How can you prevent this from happening? The answer is not simple. If the house has not been occupied for some time, it pays to consult with a local realtor or review rental listings and ads to see if it’s being advertised. Be sure to personally inspect the property with the seller immediately before signing the contract to confirm that there are no squatters, and from that point until you move in ask a neighbor to keep an eye out for any change.
If you’re looking to rent, check to make sure that the landlord owns the property or the realtor is licensed. If the monthly rent is significantly below the market rate, that’s a red flag.
Check Your Moving Company Carefully
If you’re ready to move in and haven’t fallen victim to one of the above scams, you still aren’t through the hoop. You select a mover and agree on a price. The mover shows up on time and then claims you didn’t mention he’d have to take the refrigerator and other major appliances, and that will cost extra. Or you didn’t mention that the new residence is up a flight of stairs, and that will cost extra.
Even worse, the mover only demands more money after everything is already loaded in his truck. At that point, your property is, in essence, being held hostage. If you don’t cough up the money being extorted from you, say goodbye to all your possessions.
This scam is more common than you might think. To avoid becoming a victim, ask the mover for recommendations, look for reviews online, demand a written estimate, and ask to see a copy of the company’s insurance certificate.