Mortgage scams are becoming a popular method of stealing a lot of money. These scams involve selling to multiple buyers, or sellers applying for multiple loans in a short period of time to take advantage of lax recording requirements. Also, selling property that they do not hold title to (this requires participation of professionals). Real estate agents should be observant of certain actions by buyers and sellers.
In the past, buyers applied for loans from different sources in an attempt to find the low cost alternative. It was necessary to advise buyers that applying for more than one loan was expensive and probably would reveal that there was little difference between mortgage companies. This has changed with online loan companies and with a plethora of mortgage types to choose from.
Some clues to watch for:
1. Seller can't produce a title policy or its only one page - Check tax records to determine that the person you were talking to appears on the tax rolls as taxpayer of record, and how many owners are there. 2. Seller adamant about not giving possession at closing - maybe there is another closing planned. 3. There are more than one person, family, group that appear to have a vested interest in the property - Perhaps each is anticipating a purchase. 4. House is sold and there is a new sign in the yard two weeks later. Could be a good reason - I don't know about your state, but Illinois has no fixed time for recording deeds. I had a transaction that the deed wasn't recorded for over six months.
2. Buyer(s) to good to be true. Wants to buy multiple residences for a large family and money does not appear to be a problem (they are out there, but were they walk-ins, or ask yourself why you are so lucky). A scam making the rounds today is where the buyer refinances the home from a multiple of sources and closes the transactions in a very short period of time, so that the Title company won't be aware of what's going on. The scam artist makes sure the loan companies use different title companies.
Why should an agent pay attention to such matters? The judge may find you negligent in performance of your responsibilities, or claim abetting a criminal. Carrying a book around titled "Real Estate for Dummies" is not any protection, and if you have such a book please get out of the business.
Comments(1)