Prevent Working with a Real Estate Scammer

During an uncertain economy, or for any number of other reasons, homeowners often find themselves in a financial situation which requires them to sell their property quickly. As I’m sure you know, there are tons of investment companies around the San Diego area who offer to quickly close a cash sale with no strings attached. Unfortunately though, with the rise of the house flipping industry, many homeowners have fallen into the trap of a disreputable or dishonest investor who has cost them time and money and left them in an even worse position than they originally began. So what is the difference between a reputable real estate investment company like Trusted House Buyers and a scammer who is willing and able to prey on homeowners who have found themselves in vulnerable positions?

As I’m sure you have noticed over the past few years, home flipping has gone from a small niche business to a thriving industry, thanks in no small part to shows on HGTV and radio ads that make it seem easy and lucrative for almost anyone. As a result, predatory individuals have seized on the opportunity to victimize desperate homeowners for their own gain. While there are ways to sell your house fast for cash to proven and trustworthy business people, it can sometimes be hard to distinguish between the scammers and the good guys. Here are a few tips to guide you through the process of choosing the best possible home buyer to rid you of the property which is dragging your financial future down.

Talk To The Buyer

San Diego couple talking to a local home investor about the specifics of selling their home quickly for cash.
Talk to your prospective investor prior to selling your home

It’s completely natural for a home investor to have lots of information to impart, particularly in the first conversations with a prospective seller. They may discuss any and all options for selling the home, time frames for closing, options for the seller to obtain distributed funds, and any number of other topics which are probably foreign to a seller who has never dealt with a quick sale before. Complications can tend to arise when an investor attempts to steer the conversation away from pertinent questions, and because most home sellers are novice at dealing with a real estate investor they are unaware of what is happening. 

In order to be led down an unproductive path by a scam artist, sellers should be aware that one tactic employed by scammers is to talk in circles and not give concrete information. They will promise you that they will purchase your home, but not be willing to offer specific information on how the transaction will proceed. If you find that you are asking questions of a possible investor, and they are not providing concrete answers, that is likely a red flag that the person you are talking to is not a legitimate real estate professional.

By contrast, a reputable real estate investor like Brian at Trusted House Buyers will answer any questions you have about the process of selling your home throughout the entire transaction from initial contact to final disbursement of funds. Selling real estate is a monumental experience, and having all the information you can by asking lots of questions doesn’t make you a pest, it makes you a savvy consumer who only wants to make sure that their needs are met. A truly honest investor will always be happy to answer questions and make you feel comfortable with the terms and conditions of the deal you have reached. If you find yourself dealing with a con artist who won’t answer questions, does so in a circular manner, or gets irritated that you are even asking, you should probably reconsider your options and find an alternative buyer for your property.

Be Wary of Lofty Promises

Working with a real estate investor is extremely different from traditional methods of selling your home. Because they tend to purchase properties as is and don’t require sellers to update damaged or neglected homes and because there are no realtor fees and limited closing costs, the offers of most legitimate real estate investors will often be slightly lower than full market value as prescribed by Zillow or other online marketplace tools. In many cases, owners are selling fast for cash in the San Diego market because of these factors and should be aware that this can limit the amount of money offered by an investor. 

If the investor you are speaking with promises you a sum for the sale of your home that is equal to or greater than the market value, there are likely to be considerable strings attached. Keeping in mind that most houses acquired by investors require lots of work, a professional who is offering you a number which doesn’t take that into consideration will likely indicate an individual who is trying to perpetrate a fraud. In this scenario, it certainly wouldn’t hurt to contact another investor, like Brian from trustedhousebuyers.com, to ascertain whether the quote you are being provided is reasonable or indicative of a scam being perpetrated on you when you are vulnerable financially.

Research Testimonials

Online reviews can give you a great idea of how former clients have viewed the interactions they have had with a prospective home investor.
Take some time to investigate any negative reviews that you find online.

Most websites will feature testimonials from prior clients who have provided rave reviews in order to demonstrate to prospective clients their worth. People love to express their opinions of  owners they have done business with, particularly if their experience is extremely good or exceptionally bad. In order to be a truly informed consumer, it is always best practice to conduct independent research from multiple sources prior to entering into a contract with an investor. There are many avenues for a happy, or unhappy, prior client to voice their opinion such as Google reviews, Yelp, business.com, and the Better Business Bureau among others. Don’t trust a company’s website to display a true picture of the review landscape, and instead conduct some independent research of the feelings of former customers before deciding on an investment company.

 Conversely, be aware that all reviews will not be positive. No matter how honest an investor is with their clients, or how above board all practices are, it is extremely unlikely that someone who has an established reputation in the industry because of years in the business will have never come into contact with a disgruntled customer. Keep in mind when viewing reviews, that you should likely rely on the majority to form an opinion, and take an isolated negative review with a grain of salt. Some people are never satisfied, even if they are treated fairly.

Review the Paperwork

Couple from Chula Vista spends time  looking over paperwork provided by a home investment company to make sure that their interests are protected during the quick sale for cash of their home.
Looking over paperwork prior to sale of home in San Diego

Sometimes, it is human nature to trust someone you have had several interactions with, and as a result people sign contracts everyday that they have not thoroughly read. Many times victims of real estate scammers say that they thought they couldn’t understand the contracts provided to them because they were not familiar with the jargon of the real estate industry. While legal terminology would be completely expected and totally necessary  in documents used to finalize a real estate transaction, most should be discernible to home sellers, and if there is any verbiage which is confusing the representatives present at closing should be more than willing to explain. 

If you find yourself at the closing table signing a document that presents fees you weren’t aware of earlier, this should be a major red flag that you are dealing with an individual or company who is trying to trick you at the last minute. Be aware that if you are dealing with a truly reputable real estate investor their final offer should reflect all costs on the part of the seller and that those values should be limited if they do exist. 

What to do once you realize you are dealing with a scammer?

Once you realize that you are dealing with a business trying to scam San Diego residents out of their hard earned investments there are several avenues you can take. First, you should report all suspicious activity to the California Department of Justice as well as the California Department of Social Services. In addition, it is always kind of consumers who recognize a dishonest business owner to notify others through many of the channels we mentioned when researching potential investors like BBB or Google reviews so that other local San Diego residents don’t get tricked by potential fraudsters.

Hopefully, you are made aware prior to closing that you are dealing with someone who is trying to trick you out of hard earned money. In that case, you have backed out of a deal that was not favorable but you are still in possession of a property that is weighing you down or causing financial strain. Your next step should be to contact Trusted House Buyers. As a local and family owned San Diego business of home investors, we are ready and willing to make you an offer that makes good financial sense and stands up to scrutiny. Because we have been in the home buying business for cash for several years, we know the area and can offer a fair price in cash and can close within a week in many cases. Check out some of our reviews from happy customers online, and then give us a call so that we can quickly help you get out of your home and on with the rest of your life.

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