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Ralph’s Top 10 Tips For Avoiding Real Estate And Mortgage Fraud
Newspaper reporters and other real estate industry insiders often ask me for my top tips for avoiding real estate and mortgage fraud. While this list is not my 100 percent my own (it’s been culled from the FBI and other respected industry organizations), it does represent current thinking, with my own edits and additions for addressing the evolving nature of the problem:
TOP 10 TIPS FOR AVOIDING REAL ESTATE AND MORTGAGE FRAUD
1. Always, always, always understand what you are signing and agreeing to, AND always seek assistance from a skilled real estate attorney. If you do not understand something you’re being asked to sign, ask for clarification and re-read the document before signing.
2. Ask for and check referrals and references for real estate and mortgage industry professionals. Check the licenses of the real estate and mortgage professionals with state, county, or city regulatory agencies. Make sure the people you’re dealing with are ‘in good standing’ with the appropriate regulatory bodies.
3. Be suspicious of outrageous promises of extraordinary profit in a short period of time. If it sounds too good to be true, it probably is!
4. Always conduct business at either the real estate professional’s office or a bank. Doing so gives you further opportunities to verify the agent or broker’s professional standing, as well as alleviates pressure you may feel if someone is strong-arming you inside of your own home. Never sign documents in an unmarked office, i.e., an office without business identifying signage.
5. Be wary of strangers and unsolicited contacts, as well as high-pressure sales techniques and people who play to your emotions or religious beliefs. Again, if it seems too good to be true, it probably is!
6. Look at written information to include recent comparable sales in the area and other documents such as tax assessments to verify the value of the property.
7. Make sure the name on any documents you sign matches the name on your own personal identification card, i.e., driver’s license, social security card, state issued identification card, etc.
8. Review the title history of the property to determine if the property has been sold multiple times within a short period. If so, it could mean that this property has been “flipped” and that the value has been falsely inflated either by the seller or appraiser.
9. Know and understand the terms of your mortgage. Check your information against the information in the loan documents to ensure they are accurate and complete.
10. Be cautious of any real estate industry or mortgage professional who conducts 100 percent of their business on a cell phone on the road. Upstanding real estate industry professionals almost always have an official office and telephone line. Verify this information before agreeing to conduct business exclusively via a cell phone.
If you have suggestions for how to improve this list, please e-mail me at RalphRoberts at RalphRoberts dot com, or leave a comment by clicking on the “Comments” link below.
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