Do You Know About The Most Popular Real Estate Scams?

Real estate scams are more and more popular, even though we can't see them yet. Compared to robbing a bank, stealing $200,000-worth property via a false deed or an identity theft is trivial - and remarkably safe for the thieves. Their imagination is remarkable and oftentimes we can't do much more than minimizing the damage they inflict. By becoming aware of the most common real estate scams, you may be able to protect yourself or someone you know.

False Deeds, Part 1

Most real estate frauds revolve around forged deeds. The most popular scam is using a false deed in order to get a loan secured against a property. The thief then vanishes with all the money, leaving the real owner in danger of foreclosure by the bank - oftentimes the danger is real if the owner doesn't react on the first warnings received from the bank.

False Deeds, Part 2

Another common real estate fraud is selling a property without the owners consent. The uninhabited, recently inherited and otherwise unguarded property is the most probable target for such scams. The most inventive thieves are able to even sell the same property to several buyers at the same time. However, if they have sold it only to a single buyer, the fraud can go unnoticed for months or even a year. By that time, the ?owner? is long gone, usually in another state, selling another home to someone else.

Real Deeds

The false deeds are bad enough, as such scams usually hit at random and they often can be reversed after the deed is thoroughly checked. However, the problem begins when the fraud is performed using a real deed, one that was either stolen or simply taken from the owner. The sad thing is that such thieves often recruit from our family and closest friends, people we would never suspect of anything.

The most popular way is to get some kind of authorization (or truly, just a signature) from the owner in addition to a deed. This way the thief can do whatever they like without any real risk for being caught. This is an especially popular scam used against elderly people - a nurse or a family member either take a loan in the name of the elder or just force them into taking it.

Another, even more outrageous, real estate fraud is performed by unethical door-to-door loan sellers. Under the pretext of making home repairs, they force the seniors into signing some documents which are truly high-rate loan contracts secured against the property. As most seniors are unable to repay such debt, their homes are taken by the creditor (which was its goal from the beginning) and the elder is left homeless.

Defense

Defending against such frauds is difficult. If the thieves use false deeds, it is possible to prove that you had nothing to do with the loan or purchase. However, if they use a real deed and/or have your authorization, this gets dicey. And taking effective legal actions is next to impossible if you sign the loan papers.

Here are some tips to help protect yourself from such scams: 1) never sign anything you haven't thoroughly read and if you are in doubt have your attorney review the documents before signing; 2) throw out any peddling loan lenders; 3) keep important documents, such as your deed, in a safe deposit box.

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Real Estate Q &amp A

Q. My property went into a sixty day escrow. The escrow amount was $3,000.00. Five days prior to closing the buyer's agent notified me that the contract would be cancelled due to the fact that the property did not appraise for the agreed upon value. Is the buyer's escrow forfeited?

A. In any situation, you must first turn to the closing contract itself. You should look for deadlines for certain things to occur, such as appraisals. Did this appraisal occur after the deadline? Were any other terms involving deadlines not met by the buyer? This will give you some insight as to whether or not the escrow monies must be returned. A general rule of thumb is that escrow monies cannot be released without the consent of all parties.

Q. We had a closing date set. I have just been informed that the seller is requesting a delay in the closing date. Do I have legitimate grounds for renogiation of the purchase price?

A. The reasons that a seller may wish to delay closing may vary, from the legitimate to outright procrastination. If you attempt to renegotiate the purchase price, it may be considered as a new offer, which replaces the original offer. This may therefore void the original offer and all terms negotiated pursuant to that offer. The safest way to approach this is to simply ask yourself if you are willing to wait for the property at the originally agreed upon price.

Q. I am purchasing a property. The seller has not found a replacement property, and has requested an extension of the escrow period. If I do not agree to the extension, do I lose appraisal and inspection fees, as well as my deposit?

A. The deposit will likely be refunded less a small cancellation fee. The appraisal and inspection fees will most likely be lost. If you agree to the extension, be sure to place deadlines on the seller, such as a time by which a replacement property must be found.

Q. I decided to purchase a particular home, however I have now changed my mind. How do I go about cancelling the contract?

A. A contract is a legal document which you have made with the seller. Cancellation for certain reasons may be allowed, however cancellation on the sole basis of changing your mind will likely come with ramifications. You should strongly consider these ramifications prior to backing out of the deal. You should consult an attorney regarding your potential liability in this situation. Typically, a contract cannot force parties to a transaction, however you may be responsible for paying damages to the seller. These damages can take many forms, including the lost opportunities that the seller missed as the result of taking his or her home off the market.

Q. I signed a contract to sell my home. Now I have changed my mind and want to keep the property. Must we sell our home?

A. Again, the first thing to do is to look at the legal document itself. Look for contingencies which will allow you to back out of the transaction. The buyer may decide to enforce the contract in court. You should consult an attorney. It would be wise to make the cancellation more palatable to the buyer by compensating him or her for all of their out of pocket expenses, and maybe an additional amount for their time and effort in negotiating the transaction.

Q. I made an offer on a property. The seller came back with a counter offer. May the seller subsequently sell the property to another buyer?

A. Typically, the seller is free to sell the property to the first buyer who accepts an offer. If you have not accepted the counter offer, chances are the seller is free to do as he or she pleases.

Q. Can I negotiate the selling price of a newly-constructed home?

A. You can always negotiate the selling price of any real estate. However, the seller of a newly-constructed home is usually not willing to budge on the price, for a variety of reasons, not the least of which is the small profit margin for transactions involving newly constructed homes.

About the Author:

Catherine Nguyen was born and raised in Dallas, Texas and is a licensed real estate agent. Ms. Nguyen specializes in Dallas real estate and has a career with Renowned Realty Group ? Dallas/Ft. Worth RE/MAX.

How To Find The Perfect Rental Unit

This 4 step guide to finding the perfect rental unit is quick and easy to understand. Learn how to structure your search in a way that will be most effective for the time invested. Come out ahead in your search for the perfect new home rental!

Let's get started!

1.Time Factor

Your quickly come the to the realization that most landlords/managers will require a one year lease. Is one year too long? If so, consider a sublet or a month to month lease arrangement. You should also ask what the penalty for leaving early would be.

Money Factor

Take a look at your current situation. Do you need a roommate? Do you want a roommate? Whether or not you should have a roommate will determine how you will find an apartment. If you are moving out with a good friend, be prepared for a higher level of confrontation in your new arrangement. It?s sometimes mutually advantageous to find a stranger with a solid job and good references then an old friend. Having a roommate has it?s obvious benefits. You?ll save money, have company and share the work of cleaning up (hopefully).

Children Factor

Do you have kids? It would be sad if you found the perfect location to live in and then you find out your little rug rat does not have a friend. Research the neighbors and find out where they?re at with having kids. Ask the contact people I your local classified section about the children in the area or go online and browse through listings.

Necessary Documentation

You may notice that several apartments, townhouses and houses will be taken on their first day of being advertised. It?s recommended that you start your search no later then 3 weeks in advance. In order to be the early bird bring the following material:

Two Recent Bank Statements or Pay Stubs Last years tax return Letter of employment Letter of reference from a previous landlord Tape Measure Checkbook Pen and Paper

Many city?s throughout North America are experiencing saturated rental markets. The best way to get ahead of the crowd is to be the one person that is prepared. Many rental managers and landlords respect people that have all their documents readily available.

Shane Toews is a Licenced Realtor who helps others to educate themselves on current real estate issues. He also provides assistance on how to locate quality homes, apartments or vacation rentals in Canada's Fraser Valley area. Visit his website RentFraserValley.com for more information on Canada's Fraser Valley Real Estate Market