HAAR has been made aware of a scam that, as of time of publication, has yet to reach our region. The scam targets unencumbered, vacant lots owned by persons out of state. With this scam, real estate licensees may be contacted by a person acting as the seller seeking to have a vacant lot promptly sold for below market value.
RED FLAGS
Licensees approached with requests are advised to verify that the seller matches the person on the land deed. Below is a list of “red flag” actions to be aware of:
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The buyer/seller is traveling on vacation (sometimes abroad), claims they cannot meet in person, and has to do everything by email.
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The seller has a family emergency, needs a quick cash sale, and will accept substantially less than full price if they can close in a very short time.
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The email address or phone numbers are from another country. Of course, there are legitimate buyers and sellers who live overseas, but this does raise a flag that should be checked.
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The photo IDs, such as drivers’ licenses or passports, are barely legible.
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The Seller does not require a Due Diligence fee and/or low or no Earnest Money combined with a quick closing (in order to obtain quick proceeds before a scam is discovered).
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The buyer/seller makes constant excuses, is not able to perform the terms of the contract, or is not returning paperwork.
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The buyer/seller gets very angry at the licensee as the transaction gets closer to closing and applies pressure on the licensee to make sure the deal goes through. Sometimes they offer an incentive such as commission bonuses or promising other opportunities to buy or sell.
FIGHT BACK
Independently search for the identity and a recent picture of the property seller.
Request an In-person or virtual meeting and to see their government issued
identification.
Be on alert when a seller accepts an offer below market value in exchange for receiving the payment In cash and/or closing quickly.
Never allow a seller to arrange their own notary closing.
Use trusted title companies and attorneys for the exchange of closing documents and funds.