Wednesday, July 21, 2010

Be careful of scams out there

Bad people trying to take advantage of others is as old as time itself, but the bad guys — and gals — seem especially prevalent during difficult economic times. And real estate seems to be a favorite target because of the potential to make thousands of dollars in the scam.

I came across two rental scams last week in San Diego. In both cases, they were homes that are legitimately listed for sale — but someone not involved with the property also has listed them for rent on Craigslist.

In the first instance, a friend called to ask if I could get more details about a 3 bedroom, 2 bath home in Sorrento Valley that looked too good to be true. It was. The Craigslist ad said it was being rented for $800/month. This in a neighborhood where the typical rents were around $2,500. The person representing herself as the owner told my friend that she lived outside the United States. He drove by the home while I checked the ownership records and other property information. We quickly discovered that it was a short sale and the owner actually lives in Orange County.

In the second instance, I was holding an open house Sunday in Rancho Penasquitos for one of the Coldwell Banker agents in my office. Just before closing, a man walked up with his wife and two young children and said he just saw the home listed for $1,500/month on Craigslist. He was very excited. I could see why. That price was several hundred dollars less than market rents in the neighborhood. This was all news to me. The owner wants to get this home, which is vacant, sold as quickly as possible. There is no interest in renting it. I spoke to the listing agent to confirm this, and flagged the ad on Craigslist.

In both cases, the scammers used information from the MLS (multiple listing service) in their Craigslist ads. We didn't get far enough along to see how they were going to try to get money out of the potential "renters," but be assured that's what the goal was here.

I don't know why someone would mail a check out to someone (especially out of the country) after seeing little more than an ad on Craigslist. Red flags would start popping up all over, beginning with a price that's too good to be true. It seems like the scam would become obvious fairly quickly, but, as one of the agents in my office said, "They wouldn't keep doing it if it didn't work."

Homeowners in financial trouble need to be wary of companies trying to held bail them out with a short sale or assist them with a foreclosure since these are areas that scammers also have been very active in pursuing.

If you would like more information on what to watch out for, please contact me:

Email: Phone: 619.920.2195.

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