Like any industry involving the exchange of information and money, real estate has its share of schemes and tricks designed to separate you from both. Some of the easiest ways to recognize the most prevalent scams for real estate lawyers according to the Law Society of Upper Canada include:
The client has a copy of the transfer/deed, but no other paperwork involving the property like purchase documents or surveys.
The client does not have fire insurance or utility companies do not have any records indicating the seller actually owns the home.
A real estate agent is listed in the agreements but is never seen or communicated to, or there is no real estate agent at all.
And for the rest of us:
Most real estate scams are related to false deeds used to get a loan secured against the property. Once the thief disappears with their money, the owner of the property is in danger of foreclosure. These problems can often be rectified by closely examining the deed and discussing the issue with the bank.
When a real deed is used, after from stealing it from the owner and tricking them into signing it, the reversal process is far more difficult, especially since the papers were legitimately signed. These thieves often prey on the elderly or even family members.
Nigerian scammers, or 419 scams, are like a plague when it comes to anything listed for sale online. The scammers are not always necessarily from Nigeria, but this is primarily where the crime originates and is mostly found, leading to the nickname.
It can work two ways. The most popular is when the scammer will contact you through your ad and offer to send a cashiers check for far more than the original price, telling you to cash it and send them any extra while keeping a hefty chunk as a bonus for yourself. The money comes out of your account, but the original check was a fake, leaving you with the costs.
The second popular method is copy and pasting your online ads and selling your things themselves, telling potential customers they had to leave town unexpectedly and need to take care of the transaction remotely. You send them money for an application fee or background check for them to ensure you apply, and then they disappear with your money.
Despite the obvious nature of the scams, a lot of people fall into these traps. News stories circulate the media every year about educated people falling prey and losing hundreds of thousands of dollars. By being aware of some common scams you can keep yourself and your money protected.
Rosalin Smith-Carr is a Sales Representative with Royal LePage R.E.S. Ltd., Johnston & Daniel Division. Rosalin can be reached at email@example.com or visit www.primetorontoneighbourhoods.com