Look Out for Fast Cash Buyer Scams
Published on 29 August 2022, 07:22:56 AM
Heard the one about the fast cash buyer scam? We hope so, because like mortgage fraud, fast cash scams need to be on your radar.
Just like Jeopardy!, if you’re buying or selling Ontario real estate, ‘what is a fake buyer’ is worth answering.
Recognize these fake buyers?
- Malware malingerers who lure you to an infected website with promises of a fast cash buyer, then mine your personal data.
- ‘Buy houses for cash’ investors with slick legal-esy contracts you don’t understand, who hold up the sale until you drop your price.
It gets worse. Even the most sophisticated of real estate sellers can get scammed by a fake buyer. Fast cash scams to look out for when you sell real estate in Ontario.
3 Most Popular Fast Cash Buyer Scams
- Foreign buyer fast cash scam.
A foreign buyer likes your online MLS listing. It’s for sale by owner (FSBO) — you’re entrepreneurial. They email you a fake offer, the first fast cash buyer scam. If you email your banking details, your hot prospect will transfer the buyer’s deposit directly to you.
Don’t be blindsided. If you had a licensed realtor, the deposit would go into a real estate trust account at a registered brokerage, not your personal bank account. You’d be protected from ‘social engineering frauds’ of up to $100,000 by the Real Estate Council of Ontario (RECO) Deposit Insurance Program. Read about consumer deposit insurance.
Take the bait, and your bank account could be leaner and meaner by the time a fast cash buyer scammer withdraws your savings.
- Fake buyers phishing for trouble.
A friend you rarely hear from emails you about that FSBO listing. They’re a “realtor”, or so they say.
Just click on the link they included to register your home with them, for a modest, one-time fee. Except they aren’t, and when you Google the real estate firm they say they represent, the landing page is sparse. Clues a website is fake.
Sounds like a fast cash buyer scam phishing expedition. Your “realtor” may have gotten into a friend’s email address book. Time to call your friend and see if he’s really in a new line of business. Stop a phishing expedition.
- Overpaid the deposit fast cash scam.
Your new buyer is eager to transfer the deposit. Oh dear! They hit the wrong key and transferred way too much. Could you wire them back the overpayment — $8,000 on average, according to Express Homebuyers.
You guessed it. You wire transfer the overpayment to your fast cash buyer scammer, and their deposit cheque bounces. Report a fraud.
What Does It Mean to be a Cash Buyer?
Cash buyers look for properties to rent or resell for profit. Expect an offer of about 60% to 80% of list price. Cash buyers go for a quick sale by deducting the cost of repairs and realtor commissions. They move faster because they don’t have to wait for time-consuming hurdles like getting a mortgage.
What to expect at seller signing appointments.
How Do You Avoid Getting Scammed By Buyers?
Anyone can get scammed by a buyer, but here are some quick tips to save yourself from being on the receiving end of fast cash scams.
- Buy anti-virus and anti-malware software to block infected websites, pop-ups, email attachments, and downloads.
- Refresh your manufacturer’s software protections by installing their mobile and home computer updates.
- Keep the deposit if a buyer backs out. Agreements of purchase and sale may require buyers who withdraw to forfeit the deposit. Your realtor or real estate lawyer can hold deposits in a trust account if a dispute arises. What happens if a buyer doesn’t close.
- Have a real estate lawyer search title to your property for false information. Fixing a fraudulent title transfer.
- Buy title insurance when you purchase a home. Your real estate lawyer adds it to your title for a modest, one-time fee of around $300. Why Axess Law adds title insurance to your home.
- Hire a local or Toronto real estate fraud lawyer to stop a title fraud that’s already occurred.
Why You Need a Real Estate Lawyer
When an agreement of purchase and sale has you wondering if you’re being scammed, bring it to Axess Law to review. Our licensed real estate lawyers go through your draft or signed agreement for clauses that give a buyer ways to delay the sale of your home, or take possession without your valid consent.
Find a real estate lawyer near you.
Axess Law can review contracts that offer you an assumable mortgage, rent-to-own arrangement, or private mortgage. Offers to purchase are legally binding documents, and you have legal recourse if something goes wrong with the sale of your home. Axess Law refers you to our trusted legal partners if anything is seriously wrong with your agreement.
Most common questions you ask real estate lawyers.
Transferring title to a property can leave you vulnerable to mortgage or title transfer fraud. Axess Law’s professional legal team searches title to your property before we transfer it to a new buyer. We look for financial encumbrances or construction liens placed against your title, and ensure the land registry office has the legal documents they require. Shared title with a common law spouse.
Transfer property title when you sell.
Your agreement can be voided if you take too long to conclude a real estate transaction. We check essential dates for completing all the steps in the agreement, and negotiate with a buyer’s lawyer if you need more time. Buyer not prepared to wait? We tell you what to expect if you have to cancel a real estate sale.
If a real estate deal falls through, who gets the deposit.
Affordable Real Estate Lawyers, Anywhere You Are
Access lawyers for less in Greater Toronto Area, Ottawa, or by remote video conference. Our flat fee rates are affordable, and all inclusive (excluding taxes, disbursements, and third-party charges). Your final invoice includes no surprises, or hidden charges. Your itemized statement of adjustments is explained when we deliver it, and we answer any questions you have about it. You can get independent legal advice, or add a family member to a property for a modest title transfer lawyer fee. Axess Law offers you only the legal services you absolutely need.
Use a virtual real estate lawyer to close.
Book Legal Appointments Online or By Phone
Axess Law reviews agreements of purchase and sale online or in person. Virtual video calls and document signings for real estate transactions can be arranged anywhere in Ontario, 7 days a week. Licensed real estate lawyers are available to meet day or evening at any of our conveniently located Greater Toronto Area or Ottawa law offices. Make an appointment by dialing toll free to 1-877-552-9377, or call our 647-479-0118 lawyer line in Toronto. Schedule your own appointments using our easy online booking form.
Axess Law has onsite parking and easy transit access.
