One of my Realtors® received a call today from a gentleman purporting to be the owner of property in Laconia and requested to list his property for sale. My agent researched the property extensively and provided a price recommendation based on a comparative market analysis. The individual approved of the evaluation and indicated he wanted it listed prior to the weekend, so my sales associate prepared documents and sent them through DocuSign for him and his wife to sign. Fortunately, my agent was very astute and experienced and noticed that his wife’s email address showed a middle name that started with the letter E when on the deed research she had completed indicated it was an M. That was her first red flag.
The individual then told her he didn’t want a sign on the property because he didn’t want friends and family to come at him for money which was her second red flag.
As a follow-up, she came into the office this morning and googled the phone numbers he had given her to confirm that it was him, but she could not find any listings. She then researched the owner for any other numbers that she could find. She did all the right research and came to me and my office manager for help; we were then able to obtain the real owner’s number from a third source. She then contacted the actual owner of the property in question, and he confirmed that he was not in any way looking to sell his property and is, in fact, going to be building soon. Needless to say, he was very happy that we checked with him and called the Laconia Police to report the scam.
Real estate scams are becoming more frequent and more sophisticated. Whether you’re buying, selling, renting, or refinancing the mortgage on your home, the last thing you want to worry about is being scammed.
I’ve pulled up some research. It was reported by the FBI in 2021, there were 11,578 victims of real estate rental fraud. In 2020, 14,000 people were scammed, with losses totaling more than $203 million. In 2019 11,677 people fell victim to wire fraud in the rental and real estate sectors, with losses of $221 million.
Here are some of the real estate and rental scams you should be aware of:
Rental Scames: We have seen this practice in the Lakes Region. In this case, a scammer poses as a legitimate landlord or rental agent and lists a property for rent on an online platform, such as Craigslist or Facebook Marketplace. The listing looks real, with pictures of the property. Unfortunately, after someone has paid a security deposit or rent in advance, they discover the listing was a scam. Always check records to make sure the landlord is real. Never transfer the money via wire transfer without looking at the rental in person and doing due diligence.
Wire Transfer Scams: This is one of the fastest-growing scams. I’ve seen it occur in the Lakes Region, where a very reputable closing agent was a victim of a well-orchestrated wire fraud. In a wire fraud scam, typically, your real estate agent or title company’s email gets hacked, which would reveal your information and closing details. The scammer will then impersonate the Seller asking the title company to wire transfer the escrow funds to the scammer’s account instead. Email spoofing is the forgery of an email header so that the message appears to come from someone other than the actual source. At Roche Realty Group, our emails always state “wire fraud: during your representation by Roche Realty Group, you will never be asked, via email, to wire or send funds to anyone. Not even a Title Company. Never comply with email instructions to wire funds.” During the past couple of years, we have seen several foreign buyers trying to purchase properties with attractive email solicitation that appears suspicious. We always make phone calls perform due diligence, or use an escrow service to ensure we don’t become a victim of real estate fraud.
We buy homes for cash scams: There are some legitimate businesses that specialize in buying homes for cash. However, there are a few unscrupulous scammers who will prey on the vulnerable. This scam works by promising a usually desperate homeowner a quick cash sale. The scammer convinces the homeowner to sign over the deed to the home early, promising a rapid mortgage payout, giving the scammer control of your property, which they can now rent the property for pure profit. Flyers tacked on telephone poles could be suspicious. Even if the company is legitimate, be careful; their objective is to acquire your property at a wholesale price. Always work with a well-respected Realtor® in order to obtain the highest price with the best terms in this competitive market. You want to make an informed real estate decision and not be led by pressure to accept an offer considerably less than the market value.
Vacation rental scams: This scam can ruin any vacation as it victimizes potential renters of vacation rentals. In this case, a vacationer scrolls through a popular short-term rental platform like Airbnb or VRBO to find a rental for an upcoming trip. They find the perfect place and contact the owner of the listing to book it. But scammers who post fake listings on these platforms pose as the owners to redirect renters to an outside platform. Rather than through the reputable site, the scammer directs his target to go off the platform to make a payment to book the rental, usually to a platform like Zelle or Venmo for payment. When the renter arrives, they realize they don’t have a reservation and are out the money they spent to book the property. Never book outside of the platform.
Lipstick on a pig: Knowing that a home has major defects like mold, foundation issues, fire or water damage, structural damage, oil leaks, hazardous materials, etc., and not disclosing it on the Seller’s Disclosure Statement is misleading and deceitful. Some property owners have knowingly made alterations to a property to hide these defects then lie about them on the Seller’s Disclosures. Often on for sale by owner properties, a Seller’s Disclosure is never used. It is critical that all potential buyers use a well-respected licensed home inspector to review all aspects of their home and compile a detailed report. A copy of the Seller’s Disclosure should always be filled out by the seller and reviewed thoroughly by the buyer. You want to be aware of all issues before purchasing the property to make an informed decision and not find out about them after the closing. Always work with a well-respected, reputable Realtor®.
We live in a world where we always have to be looking over our shoulders, whether it’s phishing calls, spam calls, phishing emails, and more. Real estate scams are just another branch of a very serious problem that has been infiltrating our daily lives to be aware of.
This article was written by Frank Roche. Frank is president of Roche Realty Group with offices in Meredith and Laconia, NH, and can be reached at (603) 279-7046. Sales data was compiled by a NEREN search and is subject to change. Please feel free to visit www.rocherealty.com to learn more about the Lakes Region and its real estate market.
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Before you send money, go back to the original documents you received and call the phone number(s) listed there to verify the wiring instructions you received. Never click on email or text links, or send money without verifying wire instructions with a live person on the phone from a number you've called and verified.
As a general rule of thumb, be suspicious of anyone who asks for a cash deposit upfront to see a property. To ensure you’re dealing with the real property owner try searching the local property appraiser’s website to find the name of the current property owner is and search for contact information online. Use a check to make any payment so you have an automatic receipt of it Finally, always speak with the property owner before signing a lease or making a deposit if someone says they’re representing the owner. If they claims to be a real estate agent, ask to see their license and confirm their information online through your state’s division of real estate licensing. https://forms.nh.gov/licenseverification/
You must notify the proper authorities if you believe you're being targeted. The best place to start is the FTC. You file a report online that's entered into a database that reaches local, state, and federal law enforcement agencies.
The BBB's Scam Tracker is another great place to file a complaint; it will help notify others about potential fraud activities. Also, consider contacting your state's consumer protection agency.
If you have fallen victim to a scam and given any private information, you will likely need to do more than file a complaint. IdentityTheft.gov is the government's online portal for anyone concerned that a criminal is acting in their name.