Be Safe When Selling Your House

Be Safe When Selling Your Home

Common Scams


Most attempts at real estate fraud will fall into a few categories. Become familiar with these tricks, and you will easily avoid them.

Bogus Investor


An “investor” contacts you, offering to buy your home. They offer less than market value, but promise an immediate sale. Using high pressure tactics, they convince you to sign a contract that allows them extra time and requires no advance payment (escrow or earnest money) from them.


They do not actually have the money.


Once the home is under contract, the bogus investor is free to seek a real investor who will purchase the home. If they succeed, the home will be sold to a third party and all the profit will be kept by the bogus investor. If they fail? The bogus investor has lost nothing but you have wasted months that you could have spent securing a legitimate buyer.


Do not consider any offer that does not include a reasonable down payment, and be wary of contracts with long delays before closing. When a buyer has nothing to lose, they hold all the power.

The Phisherman


An attorney or other professional-seeming “representative” for a potential buyer contacts you, allegedly on behalf of their client. Their client has seen your “For Sale” sign, they tell you, and they are in love with the property. Then, under the guise of protecting their client’s interests, they will ask you for personal information and documents.


There is no buyer.


Once the phisherman has your personal information - which could include your drivers license or social security number, property title, banking information, or whatever else they may persuade you to hand over - the identity theft is complete. They are able to open bank accounts and credit cards in your name, and leave you to deal with the unpaid bills. They may even fraudulently sell your home!


Do not provide any personal or banking information to a potential buyer. At a minimum, seek a reputable title company of your choice who can verify everyone’s identity and legitimacy.

The Accidental Overpayment


You have a buyer! They are so excited! They love your home and everything about it. They cannot wait to send their deposit. In fact, they’ve already sent it. But, oops! They sent too much. They were in such a hurry that they made a little mistake, but it’s ok. You can just send them a check for the difference.


Write that check, and you will never hear from them again.


Within a few days, your bank will contact you. The alleged buyer’s payment has bounced. The money that was supposed to be deposited in your account never actually arrived. The bank removes the money from your account. Your check to the buyer, on the other hand, has cleared. That money is also gone.


Never, under any circumstances, refund an “overpayment” into your account. If someone asks that you do, contact your bank immediately and follow their advice.

“Cash For Houses”


It is important to note that these offers, commonly in the form of mailbox flyers and roadside signs, are not always scams. In many cases, they simply offer to pay far less than market value in exchange for a quick sale. You may be willing to give up $50k or $60k in order to sell your home a few months faster - only you can decide that.


Before you call the number on that sign or flyer, consider who that company is marketing their services to.


They are looking for sellers who are in a hurry. Sellers who won’t take the time to read the fine print or consider their home’s real value. Sellers who may have other financial or family considerations that make them vulnerable to high pressure sales tactics and manipulation. They are hoping you won’t know the value of what you have.


If the phone number on that flyer is legitimate, it will still be working tomorrow. Today, call a trusted real estate agent (like me!) for a no-cost evaluation of your home’s real value. Know what you have before you give it away.

Mortgage Relief


The more experience I gain, the better I understand how quickly our lives and circumstances can change. It is all too common for good, hardworking people to find themselves in a financial situation they could never have imagined or planned for.


Unfortunately, scammers are eager to prey on them when that happens.


If someone you love has found themselves struggling with mortgage payments, they are likely to be contacted by individuals or companies offering support or assistance - in exchange for a small fee, or as soon as your loved one has provided certain information. The results can be devastating.


Fortunately, they can find information about potential scams, legitimate assistance options, and explanations of their rights on the Consumer Financial Protection Bureau website. Encourage them to review this information before communicating with anyone who offers to “help.”

Red Flags


There is no playbook of all the possible ways dishonest people try to take advantage of the rest of us. But there are things to watch for:

  • Buyers who try to pressure you into making a quick decision.

  • Buyers who rush you into signing documents you have not read or do not understand.

  • Buyers who discourage you from consulting or using the services of a real estate professional, attorney, or title company.

  • Buyers who are unwilling to make an earnest money deposit with a broker, title company, or your attorney.

  • Buyers who ask you to pay them or their vendor directly - at any time or for any purpose.