How to stay away from real estate fraud

‘Fraud’ is that word you’d rather do without when it comes to making major transactions. And if we are talking about powerful, we are talking about real estate. Getting caught up in real estate fraud is one of the worst ways to lose large sums of money, and you end up not getting what you paid for all that money. Here is what you need to do to stay away from such hoaxes.

Identify whose house it really is

‘Title fraud’, also known as identity theft, is a property owner’s worst nightmare. Scammers falsify documents by changing the property owner’s personal details to match their own. Once the property and all documents are transferred to their name, they take out a new mortgage on this property and seal the deal. Getting your house back after that is pretty tricky. In fact, what if they sell their property?

In addition to thoroughly checking who owns the property, you can opt for ‘title insurance’, which protects your property title against fraud. This also protects a new owner against existing claims, such as unpaid property taxes, unpaid utilities, and unpaid mortgages.

Do not opt ​​for loans offered in disguise

a) Foreclosure Fraud

Cash-strapped property owners who can’t afford to make mortgage payments are sometimes duped. Deceptive people make an offer to repay the loan on the homeowner’s behalf, as if to help them out of the situation, but then leave without keeping promises. Deception usually requires immediate payment for the trickster’s services and an agreement to transfer title to the trickster. Once this is done, the trickster flees, while you are left behind with accumulated amounts of debt and no property. This type of fraud is called foreclosure fraud.

b) Home Equity Fraud

Beware of those people looking at your home equity. If you rely on the equity in your home to borrow money, you should constantly be on the lookout for unscrupulous lenders so you can stay away from them.

When it comes to seizing properties, there are huge risks involved. The risks must be carefully explained by your lender. Those who want to earn extra money will embellish their application in such a way that the income, down payment, and property appraisal values ​​are exaggerated, ultimately helping them land a large loan deal.

Beware of money laundering

Money laundering is another common method of deception. Illegal money is made to look like a clean asset. Beware of people who buy property with illegal procedures and sell it to other people. At first glance, the property may appear legitimate to you, but only careful inspection and appraisal can reveal the dirty secrets.

There is only one way to prepare and protect yourself against fraud: constant vigilance! Do your homework and stay cautious and smart with every investment decision you make.