How to Recognize & Avoid Real Estate Fraud

Buying a home in Minnesota is a challenging enough process without shady lenders and other swindlers trying to scam you out of your money. Unfortunately, thousands of Americans fall victim to real estate fraud every single year. From tricking home buyers into wiring money to the wrong account to falsifying a home inspection to conceal flaws with a home, there are a lot of real estate scams out there. Keep reading for a few tips on how to recognize attempted real estate fraud and avoid falling victim to it.

5 Tips for Preventing Real Estate Fraud

1. Keep It Above Board - Does a deal sound too good to be true? It almost definitely is. Real estate scammers will often try to prey on first-time home buyers, in particular, by making under-the-table offers. For example, a scammer might promise to knock $100,000 off the asking price of a home if you give them $10,000 in cash before any paperwork is signed… only to renege on the deal which there is no physical record of. Never make a deal if the other party lacks the proper documentation, no matter how sweet they make it sound.

2. Protect Your Personal Info - Any personal information that is pertinent to buying a house, especially your bank account numbers, should be shared only with your own real estate agent. If another party asks you to give out your personal information, particularly if they do so by email, this is a red flag that someone might be trying to steal your info for fraudulent usage. It's never a good idea to provide any financial information over text, by email or through online links. Even if the person you're sending the information to is legitimate, a hacker could easily steal your private info.

3. Don't Get Rushed - A home seller trying to scam you - or a scammer impersonating the seller - may abruptly email you one morning insisting that they need you to put a down payment on the home you're trying to buy immediately or you'll lose out on it. Don't be pressured into sending over money without signing a contract or having your realtor look over the agreement! It's better to risk missing out on a home you wanted to buy than to be bamboozled into throwing away money.

4. Beware of Wire Fraud - One of the most common forms of real estate fraud occurs when a hacker impersonates your realtor or lender and insists that you need to wire money to them. Skilled scammers may send you an email or text using personal information stolen from both you and the impersonated party, making it seem authentic. To avoid being scammed, always make sure to call your real estate agent or mortgage lender before wiring money to verify that it's legitimate. If they have no idea what you're talking about, you'll know someone just tried to scam you.

5. Always Consult Your Realtor - Avoiding real estate fraud is just one of the many reasons that you should hire an experienced real estate agent to help you buy a home in Minnesota. Realtors know every scam in the book and can help you avoid getting ripped off. If a seller, seller's realtor or mortgage lender asks for a transaction that you're not comfortable with, just run it by your realtor to learn if it's a legitimate request or if someone is trying to scam you.

Skilled Realtors to Protect You From Scams

Working with a trusted real estate agent can protect you from all common types of real estate fraud, ensuring a safe and above board home buying experience. Contact the Chris Fritch Team with eXp Realty today if you'd like to begin working with one of our realtors in the greater Twin Cities metro!