Real estate fraud is a serious issue in California that affects both buyers and sellers of property. It can take many forms, and individuals need to be aware of the different types of fraud to protect themselves.
Here are some common types of real estate fraud of which you need to be aware:
Mortgage fraud
Mortgage fraud is a common scam where someone falsifies information on a mortgage application to qualify for a loan they would not otherwise be eligible for. This can include exaggerating income, understating debt or providing false information about the purchased property.
Title fraud
Title fraud occurs when a malicious party alters, forges or fabricates documents related to a property’s title to assume ownership. This can include creating a fake deed or altering a legitimate one.
Foreclosure fraud
Foreclosure fraud occurs when someone takes advantage of a homeowner facing foreclosure. This type of real estate fraud can include offering to “rescue” the homeowner from foreclosure in exchange for a fee, or buying the property through fraudulent means and then evicting the homeowner.
Investment fraud
Investment fraud is a real estate scam where someone convinces an individual to invest in a real estate venture or project that does not exist or is not legitimate. This can include the sale of non-existent properties or the use of investor funds for personal gain.
Identity theft
Identity theft involves one party using another person’s personal information to buy or sell a property. This may include using a stolen identity to take out a mortgage or to assume ownership of a property.
Steering clear of real estate fraud
It is important to remember that real estate fraud can happen to anyone and that prevention is the best protection. Buyers and sellers should be careful to verify the identities of all parties involved in a transaction and to be suspicious of any deals that seem too good to be true. Investors should be prepared to spot scams.