DON'T BE A VICTIM

There are many variations of real estate scams but fortunately, they are not too difficult to spot. They usually prey to those with little property investment experience and most often than not, victims fail to practice due diligence. While there are government watchdogs to keep the industry safer, the onus is on the investor to prevent, rather than search for a cure. Here are some safeguard measures to protect yourself from being scammed.

Spot real estate scam promoters

Honest investors, unlike scam artists, do not seek business through unsolicited contact such as mail, email and telephone. If you are looking for an investor to buy your property, ask for referrals and do careful research.

There's always a risk

Higher returns are generally equated with higher risk and that includes the chance that you may have to get more involved at some point. A promoter selling a high-returning investment as 'no work' and 'almost guaranteed' should be an immediate and powerful red flag. As with any investment, you should be willing and able to get involved if the investment does not go as planned.

Use professional services

You should always use a third party escrow service to ensure that all contractual requirements are met before funds are released. Also, try and get a lawyer to review your contracts before moving forward on any deal. Many investors attempt to avoid the high short-term cost of using an attorney in order to save a few dollars. Don't make this mistake. They may offer suggestions with which you do not agree, but you will at least be awre of the potential risks that you are taking.

Take your time

A common trick used in real estate scams is timeline pressures. The fear of missing out on a deal has compelled many investors to push forward on investments without conduction the proper due diligence and contractual work.

Check, check and check again

It is worthwhile to investigate the principals of a project before investing. This could include a criminal background check, a credit report, a Google search for their name and investigation of references.