Local Records Office Scam Guide to Real Estate Deed Fraud
Fraudulent cases in real estate scams are on the rise; deed fraud and property scams are the fastest growing crimes in the United States in 2019 according to a study by the Local Records Office. It makes sense that property rip-offs are a top priority for scammers since it’s the most expensive item that a person buys over his or her lifetime.
Large quantities of money are exchanged every time a house is sold; unfortunately, thieves know this and are on the lookout for someone easy to prey on. The experts at the Local Records Office in Bellflower, California created a list of the 10 real estate property deed scams that target new and old homeowners across the United States.
Local Records Office advises readers that if you think you’ve been a victim of fraud to contact the local authorities.
#1 – Unlisted Realtor Scam
This is one of the most common scams in the real estate market. This is how it works, the so-called realtor will sell a phony property to an unsuspected buyer. Once the check or money order is written for escrow. The bogus realtor will deposit the money into a temporary account and will later cash-out without leaving a trace.
“A fake realtors will scout-out a vacant or house that’s for sale. The seller will change the information so it can seem like it’s his or her listing. The phony realtor will usually target naïve new homebuyers that are eager to purchase“ warns Local Records Office.
#2 – Deed Fraud (Title Fraud, Title Theft)
Deed fraud (title theft) not only steals the unsuspecting buyers down payment or fees but it also involves identity theft. The crook will make fake documentation to make it look like he or she is the property owner. Using this documentation the crook will take out loans or a new mortgage on the house.
The Local Records Office prepares a copy of the deed for a small fee to help the property owner becoming a deed fraud victim. The copy of the deed will have the latest property owner’s full information from the day it was requested.
Another common tactic scammers will use besides taking out loans on the property is to sell the entire property therefore, leaving the real property owner in the dark dealing with consequences.
“Unfortunately deed fraud happens so much that one of the main reasons customers request our service is to double and triple-check that the name on the title hasn’t been tampered with because that will be a red flag that something isn’t right,” says, Local Records Office.
#3 – Arc Fault Breaker Swap Out Scam
The Local Records Office in Norwalk, CA exposed this next scam: “Arc fault swap out is a mandatory building code requirement by almost all the counties in the United States because of fire hazards.
The problem is that these electrical boxes are very expensive. The seller will install these arc breakers to pass inspection and switch to the cheaper traditional breakers afterward. Traditional breakers are the main cause of fires across the U.S.” says, the Local Records Office.
#4 – Bait and Switch Scam
The bait and switch scam is more of a scheme rather than a scam. This is how it works: The seller will list a property for a certain price. The scammer posing as a buyer will offer an “above market value” that the seller can’t resist with little or no intention of buying.
The seller and buyer will sign a contract stating that the buyer will purchase the property at a certain time. When the time is up and it’s time to pay the buyer will ask for a 9-12 months extension. After that extension is up the buyer will ask for another while all along the property is off the market and the seller is paying taxes, insurance, maintenance, utilities, etc.
The seller will go into debt from holding and paying off unnecessary bills. After months and even years of waiting the buyer will tell the seller that there isn’t a deal because of small or irrelevant things that are wrong with the property.
After all this, the buyer will offer a low-ball deal. Since the seller has been falling more and more into debt and afterward the seller usually caves.
“Many states and even countries have made ‘bait and switch’ illegal through different forms of consumer protection legislation. A lawsuit can be filed against the buyer in the U.S. if any bait and switch technique has been done.” says, Local Records Office.
#5 – Duplicate Listing Scam
Duplicate listing scams are similar to the property rental scam. The scam artist will list a duplicate property for sale or for rent. Most of the duplicate listing scams will usually take place on websites like Craigslist and Facebook Marketplace.
The scammer will list a duplicate ad of a property that is really for sale or rent for a price that most people can’t resist and will get the victim to wire him or her the down payment or first month’s rent. By the time the victim realizes that it’s a scam its usually too late.
“If listings on Craigslist or Facebook Marketplace are too good to be true they probably are, “ says, Local Records Office.
“Duplicate listings are usually easy to spot because of the price. The first thing a potential buyer or renter should do is Google the address. If various listings come up with different phone numbers, it’s a red flag. The seller or the landlord is out of state or country, it’s a red flag. If no one is available to show the property, you guessed it, red flag” says, Local Records Office.
Local Records Office says, “Since the rise of websites like Realtor, Zillow, Redfin and CENTURY 21 to name a few scams have become more common. However, just because a listing is a duplicate doesn’t mean it’s a scam. These types of websites make it easier for sellers to reach out to a wider range of audiences”.
#6 – Fake Real Estate Lawyers Scam
Local Records Office warns about fake real estate lawyers, phony real estate lawyers will take control of the proceeds of the real estate closing by impersonating one of the parties and taking full control afterward. After taking control he or she will redirect the proceeds from the sale to his personal account.
“The best way to avoid this scam is to make sure the lawyer is a licensed lawyer is by checking your state’s The State Bar website. Here is California’s State Bar website. Another great way to see if your lawyer is legit is to use a good ole Google search. Google does a great job of searching local and out of state people, all you need is his/her full name” says, Local Records Office.
#7 – Fake Escrow Service Scam
Phony escrow services have gotten sophisticated over the years. With the help of search engines, scammers can get a hold of public records, official-looking documents, such as deeds, real estate agents numbers, applications, etc.
Just like other scams the biggest giveaway is that they want to get paid by using services like Western Union, Money Gram or have money wired to them. Like mentioned before if the price is too good it probably is.
“In this day and age getting paid by Western Union, Money Gram or getting money wired to you is out the window not only is it old fashioned it raises a red flag,” says, Local Records Office.
How to Report Real Estate Scams
Real estate scams and online scams are becoming more and more common, so reporting scams needs to become more common too, report real estate scams to the Federal Trade Commission directly by at FTC.