101 Series: Guarding Against Vancouver Real Estate Scams – Consult with Bruce Coleman, Vancouver Mortgage Broker
Guarding Against Vancouver Real Estate Scams
Investment scams come in all shapes and sizes. It’s a sad reflection on our society that we can no longer rely on the simple handshake to seal a deal. Even a signed written contract can be rife with sneaky “small print” that can bleed us financially dry.
Every investment of our hard earned money has to be approached with performing some form of “due diligence.” It is always wise to be use common sense and take the time to do some research. This also applies to the realm of real estate where you can also encounter scamsters and con artists.
Let’s take a look at some of the more common scams involving real estate in more detail.
Property Title Fraud Scam
These types of scams are a lot less common now than they use to be but you still have to be on guard against them. It occurs mainly with a home whose mortgage has been paid off as the scam is easier to perpetuate in those instances. Essentially, the con artist uses faked documents which they register when transferring the sale of property.
When the mortgage goes through, the scam artist can grab the mortgage money and leave you holding the bag and the deed to a property which you don’t own.
You can avoid this scam by using a real estate lawyer and especially protect your interests and investment by buying “Title Insurance.” This type of insurance also protects you from unexpected liens or where encroachment becomes a litigious issue.
Home Foreclosure Scams
This is a scam to be careful about if you find yourself in a cash crunch and might be facing foreclosure on your home by the lender. You might be approached by a supposed lender who offers you the opportunity to consolidate your loans if you transfer the property title to them and pay them some upfront fees.
The con artist will take the money you pay in upfront fees and then neglect to pay off the bills. Then, since they have the property title, they will renew the mortgage, take the money and leave you with the debt.
Scams Involving Property Investment Seminars
Always be wary of those info commercials and online advertisements about how you make tons of money investing in real estate. Although some of these seminars advertised are run by genuine financial advisors, some as not above board and are run by unscrupulous entrepreneurs who are more interested in separating you from you money.
As it is difficult to differentiate between which ones are legitimate and which ones are less so, you should do some serious research before you pay to take these courses.
In some instances, the less legitimate seminars will try to get you to invest more money by promising some “sure to make you some big money” investment. Always remember the old adage that “if it sounds too good to be true – it probably isn’t.”
Cons Involving Home Improvement Projects
Far too many people fall victim to unscrupulous contractors or those purporting to be a contractor. Beware of any so-called contactor who comes knocking on your door and tells you that they can re-do your roof or pave your driveway on the cheap because they have some left –over materials.
These scam artists will always want to get some money up-front. However you make the up-front payment it is likely you will never see these guys again. Sometime, they may even make pretence of starting a job so they can collect that extra payment. Then, they disappear leaving you with a bigger mess. You will have to contact a legitimate contractor and pay additional money to complete the project.
Always research a potential contractor to ensure that that they are not only legitimate but that they have a solid reputation.
With anything involving real estate, your home or property investments, just remember that you should always be cautious and perform research before you invest.