There are many ways to sell your house besides hiring a real estate agent and listing it on the open market sites like Sundae.com. One is through a real estate investor or cash buyer who is into buying properties that are usually in numerous states of disrepair or any condition. Typically, their goal is to flip it and eventually generate revenue from the sale.
You might find them on some flyers on telephone poles or signs that read “We Buy Houses.” But though they are a legitimate part of the real estate market, many scammers use them to rip off hard-working people out of their money and houses. Nearly anybody can disguise and make an offer on the houses since there’s no license required.
As such, it’s essential to be aware of how this type of buying process should look like so you can detect a fraudulent cash buyer. To ensure a safe home sale transaction, we’ve enumerated below the indicators of “We Buy Houses” rip-offs every seller has to know.
Hefty Processing or Administration Fees
One of the indicators of a “We Buy Houses” rip-off is the movement of financial transactions. The money should always flow in the seller’s direction and never towards the buyer. So, it’s a great warning if the buyer asks you to give them money, whether as a processing fee or administration fee.
Such scammers can often get desperate sellers to pay up in a short period. But once they get the money, they will be gone and onto the next sitting target. Remember that you’re not paying to sell the house unless you’re putting it through a traditional listing.
Eagerness To Buy The House Sight Unseen
Another sign of a scam buyer is their eagerness to buy the house sight unseen. A legitimate real estate investor or cash buyer needs information before making an offer. Even if they buy run-down houses, they still want to see the property and collect the necessary details to make a sound decision.
Only a fake buyer will close a deal without knowing anything about your property. If they’re too eager to get you to sign and accept the offer right away, they are most probably up to something. Keep in mind that a reliable investor or buyer will give you time to think and ask questions before committing to anything.
There’s always something off with a scam buyer if you know what to watch out for exactly. Any extreme behavior is a clue you’re talking to a scammer. But one of the common “We Buy Houses” rip-offs is a contract bait and switch. When the buyer tells you to write up the verbal agreement you reached but present a different one, it’s a massive red flag.
A legitimate real investor or cash buyer won’t keep you waiting for too long. They may want to see the house and consider some factors before coming up with an offer, but they won’t delay it. If they’re likely to purchase your home, they might offer you a deposit as a sign of good faith. But if they don’t want the house, they will tell you upfront and move on.
But a scam buyer won’t be frank with you and may lock up your home under contract without putting up any money. They may even trick you into transferring the deed of sale to them while the mortgage remains in your name. If they send some other people to check your house, it’s another unprofessional behavior you should be concerned about.
Questionable and Unverified References
Every response you get from the buyer is an opportunity to determine whether or not they are telling the truth. A reputable “We Buy Houses” company is more than willing to give you the details you need to make you feel assured. The scammers might do the same, but the references they might provide are questionable and unverified.
If you cannot search the company’s name, address, and website, they most likely don’t exist. Never be afraid to get more information that you think is necessary. If they withhold the answers, they are probably hiding something. Note that the more information you can verify, the more you can ensure their credibility.
No State-Regulated Documentation
A legitimate one must have documentation to prove that they are reputable to do this type of business. Most of them also have at least a background in real estate and certification that designates training and knowledge of state and federal regulations.
But a scammer might not have any state-regulated documentation. Bear in mind that if the buyer doesn’t have proof to back up their financial claim, it can be a sign that they are not credible in doing business with you.
Connect With A Reputable Home Buyer
House buying scams are everywhere. But there are still many legitimate “We Buy Houses” companies that can and will buy your house. While you have an idea of what to watch out for in a buyer, remember that scammers are so subtle in what they do that it can be hard to detect them. Always do your research before you make a transaction with anyone.