How To Avoid Foreclosure Scammers

Despite a slow recovery of the housing sector, there are still a considerable number of foreclosures on the market. In fact, there are so many foreclosures that some con-artists are using them to run rent/buy schemes to swindle unwitting victims:

How The Scam Works

Scammers choose a foreclosure property that seems abandoned. Usually it’s a house that’s been empty for a long time. They run a “For Sale” or “For Rent” ad on a social media site such as craigslist to lure in potential marks. Because there are so many legitimate for sale and for rent ads online scans can be difficult to spot right off. But there are a few red flags to look for:

1. The deal is too good to be true.  Be suspicious of any ads offering ridiculously low prices. If it’s a deal of a lifetime, it’s probably the scam of a lifetime. These scammers use low prices to attract the most desperate targets.
2. The “owner” won’t let you view the property and they’ve got a very complicated reason why. Scammers will claim that they’re out of town with a sick child, burying a parent or closing some important business deal. While legitimate owners might have these challenges, wordy, detailed excuses usually indicate that it’s a scam.
3. The “owner” offers to send you the keys, but they want you to wire them a “security deposit” first. Just don’t do it. If they’re legitimate, they won’t demand money just to view a property.
4. The “owner” offers to send you the keys so that you can view the property, but they want you to send them sensitive financial data. This usually happens with rental scams. Don’t send any financial data to an unknown person. If you do, you may be snared into an identity theft ring.

If you want to check the legitimacy of the “For Sale” or “For Rent” ad, there are a few things you can do.

1. Get the address of the property. Drive by the address to see if it’s occupied. If it looks empty, check with your county to see if the property is in foreclosure. If it is in foreclosure and your contact is claiming to be the owner, you’re dealing with a scam.  Foreclosure properties are owned by the bank until they’ve been sold or auctioned.
2. Even if your contact is claiming to be a bank representative, verify his claim.  Look up the bank’s info and call them directly to verify his legitimacy.
3. If the house is not in foreclosure, check with your county to find out who actually owns the property. Using the contact information you find in county records, reach out to the owner and verify if they placed the ad.

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