Make Sure Your Clients Know About These 3 Common Real Estate Scams
Smart people are duped every day by scams from equally as smart, and some would say “vile,” criminals. Unfortunately, once the deceit has been found out, the damage has already been done. That is why it is so crucial for your clients to know that they can make proactive actions against these forms of attack.
Although you are their first line of defense against these scams, you can only do so much to reduce the chance that your clients will fall prey to these traps. Take a look at the below scams and how to defend against them, and educate your clients today!
Real estate scam #1: Transferring funds to a fraudster
Your client has picked the home and made the offer. Now they are ready to wire the funds, and after seeing an emailed request, they do as instructed. What’s the problem? The email wire request is phony and sent from a criminal, and the funds were transferred to the third-party. Unfortunately, many do not recover this money. It is usually too late, once it has been found out.
Defend Against It: Although cybercrime can hit any industry, there are more “old-school” approaches that can prevent this intrusion. Make sure your clients only respond to a verbal request for a wire transfer or at least consult you before taking any steps with the transaction. Be sure to always have your clients sign the “Wire Fraud Advisory” to further inform them.
Real estate scam #2: The moving company holds their items hostage
The transaction has completed, and your clients are ready to move! We all know how stressful and time-consuming this can be. Your clients decide to call up the cheapest moving company without looking into it. The problem? The shady company picks up their items and increases their quote, effectively holding their items for ransom until the higher amount is paid.
Defend Against It: “This scam is so prevalent that it’s listed on a U.S. Department of Transportation site called Protect Your Move,” says realtor.com.
The best way to handle the move is to have them conduct due diligence to ensure that their mover is registered and insured and that they have a written estimate. It is also suggested that they have someone from the moving company check out their items before writing up the estimate.
If the move is not far away, have them consider only hiring moving laborers to load and unload a rented moving truck. This gives them more control over their items as they will be in charge of transporting their own belongings. This option may even be more affordable.
Real estate scam # 3: The “I’ll sell your home or buy it myself” Tactic
This tactic is used by those less-than-scrupulous real estate agents in order to get new clients and listings. The agreement comes bundled with many exceptions in the agent’s favor that most homeowners would never agree to. Typically, the agent’s offer on the home would even come well below market value, rendering the whole tactic undesirable to most homeowners who are educated about it. Once the homeowners realize the terms, the agent will then offer to “list the home the standard way.”
Defend Against It: Make sure your clients, or potential clients, understand that some things may sound too good to be true, because it is. The more homeowners that are educated about this tactic, the more they may be able to see who has their best interest in mind.
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