Last updated on September 25th, 2023 at 12:13 pm
When you’re buying or selling a property, one important choice you’ll have to make is selecting the best realtor.
With so many agents on the market who can you be sure that you’re working with is a real agent?
It’s true that there many fake realtors that take advantage of unsuspecting buyers as well as sellers, and it’s important to know how to identify these scammers.
The real estate market is extremely competitive, and fraudsters always find new methods to profit of the public.
It doesn’t matter if they’re posing as an authentic agent or employing tricks to deceive clients, fake agents can cause serious emotional and financial damage.
Many fraudsters are now posing as we buy home companies who will buy your property in cash!
It is paramountto recognize warning signs and to protect yourself from falling prey to real estate scams.
If you’re looking for an agent in real estate knowing the warning signs that point to an untrusted agent is paramount.
By being aware and alert you will be able to ensure an easy and secure property transaction.
We’ll detail the most effective methods to identify fake real estate agents and guard yourself against potential frauds.
We’ll also go over the best practices for closing a sale and ways to verify the identity of clients.
What is a fake real estate agent
A fake real estate agent is a person who presents themselves as a licensed real estate professional but does not hold a valid license or the required credentials.
They may attempt to sell, buy, or rent houses illegally, often targeting unsuspecting clients to scam them out of money.
- In the United States, 1 in 5 real estate agents are fake, according to a 2018 survey by the National Association of Realtors (NAR).
- In the same survey, it was found that fake agents account for 20% of all real estate transactions in the US.
How to Protect Yourself From Realtor Scams
When dealing with real estate professionals and potential buyers or sellers, protect yourself from fraud by staying vigilant against commonplace scams like email alerts from unverified sources.
Before conducting business with anyone in the industry or attending an open house or showing in remote locations, research their credentials and verify their identity as best you can.
TREC haș a page that allows you search for any disciplinary actions that have been taken against any agents.
Ask the agent to provide you with a list of homes they have recently sold or are currently listing.
What are some things to watch out for when working with an agent
Poor communication: If the agent is unresponsive or takes an extended period to reply to your messages or calls, it could be a sign of their lack of commitment or dedication to your needs.
Lack of local market knowledge: A competent real estate agent should have a solid understanding of the local market, including recent sales, neighborhood trends, and property values. If your agent appears uninformed or provides inaccurate information, it might indicate a lack of expertise.
Pressure tactics: Be cautious if your agent pushes you into making quick decisions or tries to persuade you to buy or sell a property fast in San Antonio TX that doesn’t align with your needs or preferences. They should respect your timeline and help you make informed decisions.
Dual agency conflicts: Dual agency occurs when an agent represents both the buyer and the seller in a transaction. While legal in some places, it can create conflicts of interest. If your agent is representing both parties, ensure they provide fair and impartial advice and disclose all information transparently.
Inadequate negotiation skills: One of the key roles of a real estate agent is to negotiate on your behalf. If your agent seems ineffective in negotiating prices or terms, it could lead to unfavorable outcomes for you.
Unprofessional behavior: Watch out for signs of unprofessionalism, such as consistently arriving late, not following through on commitments, or displaying a lack of respect. A professional agent should conduct themselves with integrity and professionalism.
Pushing beyond your budget: If your agent consistently suggests properties or encourages you to spend more than your budget allows, it may indicate a lack of respect for your financial limitations. A good agent should help you find properties within your price range.
Limited availability: While real estate agents have multiple clients, they should still make time for you and prioritize your needs. If your agent frequently cancels appointments or is consistently unavailable, it might be a sign that they are not giving your transaction the attention it deserves.
Lack of transparency: Your agent should provide you with all relevant information about a property, including any known issues or potential concerns. If you suspect your agent is withholding information or being evasive, it could be a red flag.
Unreasonable fees or charges: Real estate agents earn a commission on transactions, which are typically a percentage of the sale price. If your agent’s fees or charges seem unusually high or they introduce unexpected costs, it’s important to question and clarify the reason behind them.
Stay Safe When Listing Your Property
Protect yourself from potential scams when listing your property by verifying the credentials of any real estate agent you work with, avoiding quick decisions or deals that are too good to be true, and enlisting the help of a licensed attorney for legal assistance.
You are going to letting someone list your house, so spend some time verifying who you are working with.
- Don’t provide personal information until you’ve confirmed legitimacy, and stay vigilant against common email alert scams and thieves during showings (expensive jewelry, house keys).
Commonplace Scams For Buyers And Sellers
Fake rental listings, wire transfer fraud, and phishing emails are commonplace scams in the real estate industry.
Before making any payments or signing contracts, buyers should verify the legitimacy of a realtor and that the house is real!
Unsolicited offers or requests for personal information should raise red flags for sellers.
Reduce the risk of scams by working with reputable and licensed real estate professionals like a listing agent, real estate broker, or even a local association like NAR.
Here are some examples of what to watch for.
They won’t use their real name
Today, people are more savvy than they used to be, leading to avoid falling victim to fraudsters.
However, the majority are unable to distinguish genuine agents and disguised agent.
The majority of fraudsters do not have their original names to avoid being tracked and arrested.
They appear well-dressed and attractive, which makes you believe they are hungry wolves.
Any narrative they might present about themselves is a complete fake. It is mandatory to ask for the company’s number and request to speak to the customer service representative.
It’s possible that they are prepared for this scenario, however, in the majority of cases they don’t.
If they start to muddle words or make excuses, then the answer might be staring you in the face.
They use another companies marketing materials
Some people will do anything to scam others out of their money.
They may even attend meetings held by a real estate company to pose as agents.
This allows them to access company marketing materials and deceive people into thinking they are legitimate.
However, it does not mean they have all the knowledge they claim to have. To besure, ask them detailed questions about real estate and observe their responses.
They will negotiate the price too early
Fake individuals are only interested in taking your money and not helping you secure the property.
If you show no interest or say you can’t afford at the price, they will likely discount the amount too fast!
They will try and get you to make a decision immediately
A real estate agent’s role is not just to sell properties, but to guide buyers through the process.
They have extensive knowledge of different locations and their potential.
A real estate agent won’t pressure you into making a purchase on the same day.
They will educate you about real estate and provide you with information.
If you’re not interested, they may leave a flier and move on.
They understand that there’s no need to exchange contacts immediately but provide contact information for future reference.
They are patient and not in a hurry.
A fake real estate agent lies to make you think they’re helping you and that offer will close soon.
They try to confuse and rush you into making a quick payment.
Don’t fall for it.
Instead, tell them you’ll get back to them.
Take your time to research the company.
Visit their website and engage with their content on social media.
If you need help, ask a mature child or trusted person, not the agent.
They provide you will false account information
A fraudster can take a real company’s flyer and edit it to create a fake one with their personal information.
Real estate companies typically have their account details on their fliers.
They may even try and have you wire money into their account. Remember, agents and brokers don’t accept money. That must be wired into the title company.
Take the time to investigate before making any payments.
Be cautious, as they may try to accompany you to a fake location and it could potentially be a trap.
It is also worth considering that the address on the flier might be fake.
Pressure them with questions
To test their competence, ask them a few questions.
- For example, who is the broker?
- What is the company’s vision and mission statement?
- How long has the company been around?
- How many staff members do they have?
- A real agent will answer these questions directly and confidently.
- Asking these questions not only helps to gather accurate information but also tests their patience.
- Real estate agents are trained to handle customer inquiries patiently, but fake agents lack this training or awareness.
What are the consequences of working with a fake real estate agent
- Financial Fraud: One major consequence of working with a fake real estate agent is the potential of financial fraud. These scammers can trick you into paying for a property that does not exist or is not actually for sale.
- No Legal Recourse: If something goes wrong during the transaction, you will have no legal recourse because the fake agent is operating illegally.
- Loss of Money: A fake real estate agent can disappear after collecting money, leaving you with a heavy financial loss.
- Identity Theft: Giving your personal information to a fake agent increases your risk of identity theft. They could misuse this information to carry out fraudulent activities.
- Wrong Property Valuation: You may end up paying much more for a property than it is worth because a fake agent is not likely to provide a correct valuation.
How do fake agents find their victims
- Internet Listings and Social Media: They often post attractive but fake listings on legitimate real estate websites or social media platforms. These listings usually feature properties at a price that is significantly lower than the market rate to attract potential victims.
- Unsolicited Contacts: Fake agents might contact people directly via email, text message or phone call based on contact information sourced from a variety of online and offline list sources, posing as a real estate agent.
Real agents are identified and verified by their company and are authorized to speak on behalf of the company.
However, it is important to be cautious as some individuals may falsely claim to be real estate agents by using fake company fliers and providing misleading information.
To avoid becoming a victim watch out for the common tendencies of fake agents.
If you think anything is wrong hang up the phone, or thank them for the time and move on.