Have you finally decided to sell your home to a real estate investor?
Selling your house as-is to an investor buyer can be the best solution if you find yourself in a situation where you need to: move quickly due to a particular reason (like relocation, divorce, etc.); financial issues (like foreclosure, tax liens, medical debt) or when you just want the convenience of selling as-is to a cash buyer. When your key priorities are convenience, speed, and cash, selling to an investor is the answer.
However, the lack of knowledge among home sellers about how genuine real estate investors operate has allowed criminals to thrive by duping hard-working people out of their money and houses. Looking to make a fast buck, these individuals will pretend to be investors and leverage methods used by real investors to convince sellers that they are the real deal. This has caused people like you to panic and understandably be wary of investors.
As selling your house is an important transaction with a significant impact on your financial future, dealing with an investor requires due diligence. It is necessary to know what selling to a legitimate investor should look like to identify real estate scammers who may want to use the situation against you. But, how can you tell people like us apart from the frauds?
This brings us to the question, how can you identify a reputable investor?
Here are essential tips on how to avoid home investment scams:
Four Tips On How To Avoid Home Investor Scams When Selling Your House
1. Can you verify that their company exists?
Let’s say a person claiming to be a real estate investor calls you. They are privy to the information that you have a house for sale and offer to buy it. They most likely want to close the deal as soon as possible – just the way you would prefer it. Or, let’s imagine you saw an advert online or a “we buy houses” sign or received a postcard in the mail, and you are considering reaching out to them. Whichever way, the first question you may want to ask yourself, “Is this person or this company real?”
Start by asking them the right questions: What is the name of the company? Do they have a website where you can learn more about them? What is their address?
The answers to their questions will provide you with the chance to follow up with other questions. You should not be afraid to ask more questions if there is a need for clarification. Predatory individuals will often leave you feeling confused, so notice the warning signs if you’re getting conflicting, contradictory, or evasive messages. Legitimate investors like Bost Redevelopment are more than willing to answer your questions no matter how endless and trivial you may think those questions are. We are in the business of solving problems! If we can’t create a win-win situation for you, we’re probably not the right company. We want you to feel good about doing business with us.
Not only will we provide the necessary information, but we will also direct you to sources that can provide backup for our claims. Be careful with “investors” who threaten or intimidate you or leave you feeling like something isn’t adding up. If you’re feeling confused and your repeated efforts to obtain clarification seem to be ignored, avoided, or spun out, be extremely careful.
The more open and transparent a company is, the more likely it is that they are legitimate. If you need additional information about the company, you can also run a Google search on them. Look out for reviews about the company. Check if complaints have been filed against them with the Better Business Bureau. Were those complaints all resolved, or are there multiple unresolved complaints about them? Read the complaints. Does the person with the complaint have a rational story, or are they just venting about something unrelated to anything the company could have helped them with? Companies that get multiple negative complaints are red flags that should not be negotiated with, especially if you see a complaint pattern. Other information you find online will provide you with further insight.
2. What can you find on their website?
Real estate scammers will stop at nothing to blur the lines between themselves and legitimate investors. They are out to get good people like you. It can be hard for inexperienced home sellers to distinguish between the website of a scammer and that of a genuine real estate company. However, if you know what to look for, you will be able to identify the difference quickly. So how do you tell the difference?
- Website content and activity
Most real estate scammers’ websites only have a front-page and a contact page. Aside from that, there is usually nothing significant on these websites in terms of contents and resources. On a website owned by a legitimate investor, you are likely to see regular updates of materials and any other activities. For example, Bost Redevelopment regularly adds new, helpful articles to enlighten and inform potential house sellers.
Even when these scammers’ websites do have contents, they are often ridden with spelling and grammar mistakes. Unlike real estate scammers, genuine real estate companies put effort into their content creation and marketing strategies. For example, on the Bost Redevelopment website, articles are created to cater to different types of home sellers from those facing foreclosure to those with expired listings, and many more. Also, is the company or its owners involved in the community? Can you find a LinkedIn profile for the owner of the company? Does the owner have a social media account, such as Facebook? What kinds of things are they posting about? Does this person seem like a scammer or like someone who is trying their best to do the right thing?
One of the things that may catch your attention when going through an investor’s website is other investors and investment companies’ recommendations. And real estate scammers know that too. Hence, they may fabricate recommendations from reputable companies. Or worse, create recommendations by fake real estate companies.
To not fall for this trick, contact the real estate companies that provided these recommendations to verify. Doing this will help you check if the company exists and alert these real estate companies to illegal use of their name. Try to find the people who posted recommendations. Do they have LinkedIn accounts? Try reaching out to them and asking if they could tell you more about the company or its owners based on their review.
- Website details
Who owns the domain name? Is there a ‘Contact Us’ page?
All these oft-overlooked details can save you from losing your hard-earned money. To determine whom the domain is registered to, research by checking the WHOIS details.
Then, scroll down and look up the ownership information for the domain. This will often provide you with the name of the domain owner as well as their contact details.
3. Who is the face behind the company?
The next step is to know the face behind the call.
Knowing the person or company, you are dealing with will give you more assurance. To do this, organize a face-to-face meeting with the real estate investor. Many real estate experts suggest you choose a local real estate investment company to make this process easier. This is because many scammers posing as investors are likely to pretend to be an out-of-state business to avoid serious scrutiny or a face-to-face meeting.
Although some real estate investment companies do legitimate out-of-state business, at a minimum, you should always expect to be able to organize a video call with the investor or one of their employees. The nearer the investor is, the easier it is to meet them for a meeting and establish trust. With that said, due to COVID-19, some investors are more willing to purchase properties remotely without ever actually visiting the property. Any legitimate investor who does this should be willing to explain how they make this practice successful. Again, if anything seems odd or confusing, listen to your gut.
But after meeting with the local investor, how can you tell if he is not a smooth scammer putting up a clever act?
Well, a genuine investor will know everything about the local real estate market. They understand the trends, demands, and risks involved. They will be able to provide accurate information about your home’s value based on the current market. If they can’t immediately answer your question, such as if they need to confirm it or gather some information (such as from the MLS), they should be able to get back to you within a day or so with a detailed answer to your question. A scammer may not be able to provide this information.
A scammer also will not have access to the MLS because only licensed real estate agents are able to access the MLS. Suppose you need any more clarification about the investor. In that case, if they are an actively licensed real estate agent, you can look up their license information online via the state real estate license portal, such as here: https://secure.utah.gov/rer/relv/search.html. At Bost Redevelopment, our owner is a licensed member of the iProRealty Network in the State of Utah and a member of the National Association of Realtors (NAR). This information can be easily verified on the organizations’ websites.
4. How does a home investment transaction work?
The best way to spot a scam is if you understand how an investor transaction is supposed to work.
For one, in this type of transaction, the money flows in the seller’s direction and never to the investor. You should be wary of any investors that ask you for upfront payments. You don’t have to pay any fee before an investor takes a look at your property. You are also not required to pay for repairs or redecoration, as that is the investor’s responsibility. When you sell your house to an investor, they do not ask for closing costs or commissions. Some investors provide additional help by paying for your packing, travel, moving expenses, or any minor charges that may delay your departure. (For a more detailed rundown on the costs that investors should cover, check out “Is selling my house to an investor a good idea?”)
Secondly, no reputable real estate investor will offer you money without first performing some amount of due diligence on your property. Any investor that offers to buy your house without performing any due diligence could be a scammer. Remember that property investment is a business. As with all businesses, it is necessary to evaluate every detail about a business deal (in this case, your house) to prevent making an expensive mistake. Not doing this could get the business in trouble and lead to bankruptcy.
Lastly, is the investor too eager to close sales? Avoid any person trying to pressure you into signing before you have a chance to think things through. They are likely scammers trying to push you into signing away your property. You need to read every possible term and condition before signing. You may need to have a property attorney during this process. At Bost Redevelopment, we are confident in the fairness of the contracts we give. We will allow you to go through the details of your sale as long as required. We are obligated to give you all the help you need and make you comfortable as you go through the process.
Are you looking to sell your house to a legitimate investor today?
If you are interested in selling your house to an investor today or want more information, please send us a message below with your contact information and let us know you are interested in allowing Bost Redevelopment to buy your home. We will assess your home within the shortest time frame, offer you a fair price, and close the deal within 5 – 10 business days.
Our owner is a licensed member of the iProRealty Network in the State of Utah, a member of the National Association of Realtors (NAR), and we abide by the NAR Standards of Practice. Contact us today if you’d like to talk with us to determine if having Bost Redevelopment buy your house as an investor is right for you.