Month: May 2023

Real estate sales and purchases are the largest financial transactions that most people will ever make, typically involving hundreds of thousands of dollars. On top of that, the process can be unfamiliar and complicated. For these reasons, real estate fraud is unfortunately common.

How do you avoid becoming a victim of real estate fraud? The best way to protect yourself is by knowing the most common types of real estate fraud. Here’s a list to get your started!

Appraisal Fraud

Appraisal fraud is one of the most common types of real estate fraud, in which the seller or buyer uses a dishonest appraisal to misrepresent the property’s value. This may be done with an appraiser willing to estimate the property’s fair market value falsely. Alternatively, the buyer or seller may alter an appraisal to be more favorable.

What You Can Do

Get your appraisal, especially if the figures don’t sound right. Mortgage lenders are well aware of this practice and often insist on hiring an appraiser from an approved list.

Title Fraud

Sellers may attempt to conceal problems with the title, or simply sell a property that does not belong to them.

What You Can Do

Buyers should use a reputable escrow service and hire a professional to investigate the title before completing the purchase.

Home Equity and Home Renovation Fraud

It’s common for homeowners to get a home equity loan to pay off debts or finance property improvements. There’s nothing inherently wrong with this; being secured by the property, home equity loans often have lower interest rates than unsecured personal loans. Unfortunately, however, many predatory lenders operate in this field, and homeowners often end up paying far more than they expected.

Such lenders may lie about the loan terms, create false urgency to pressure homeowners into signing contracts before they can read them, or even sign blank ones.

What You Can Do

Be careful when taking out a home equity loan, because your home will be on the line. Don’t let lenders pressure you into signing anything you don’t fully understand.

Foreclosure Bailout Fraud

Foreclosure bailout fraud is particularly despicable, involving stealing from people desperately trying to keep their homes. Because foreclosures are public proceedings, scammers use court records to identify their targets. They contact homeowners and offer relief by arranging a short sale to the scammer, who will rent the property back to the owner after paying thousands of dollars in upfront fees. The scammer disappears with the fees, and the homeowner has lost time and money at a critical juncture.

What You Can Do

If you need to catch up on your mortgage payments, the best course of action is to open a line of communication with your lender and try to work something out.

Get Help from a Real Estate Attorney

Those who perpetrate real estate fraud take advantage of their victims’ relative lack of knowledge. The best defense is to have someone on your side with a deep knowledge of real estate transactions and law who can identify fraudulent behavior and keep it from derailing your life.

Our real estate litigation specialists can protect you from bad actors and ensure your transaction is efficient and fair. Contact our office to discuss your situation.

Real estate fraud can be particularly devastating. Not only are their large amounts of money on the line, but problems concerning our homes are uniquely stressful and emotional.

Unfortunately, real estate fraud is not uncommon. Unscrupulous people try to take advantage of the fact that most people are unfamiliar with these types of transactions and then disappear with thousands of dollars in ill-gotten gains.

Hiring a real estate attorney to investigate potential fraud is a great first step toward taking back control of the situation and hopefully recovering your money.

Investigating the Fraud

If you’ve fallen victim to real estate fraud, don’t beat yourself up over it. The people committing these acts are often very sophisticated in terms of technology and expertise. Now it’s time to get people on your side who have even more expertise to build a case against the fraudsters.

Building a fraud case means investigation and lots of it. There can be many paperwork, interviews, and even surveillance to sift through. The benefits of hiring a real estate fraud investigator are numerous. Fraud investigators know what they are looking for, where to look, and how to do it lawfully. Furthermore, an experienced investigator will know how to proceed swiftly, which is important for resolving the case promptly and ensuring you don’t miss crucial court deadlines.

Because the goal of a fraud investigation is ultimately litigation, it makes more sense to go ahead and hire an attorney rather than a private investigator. Law firms can typically carry out their investigations and hire specialists if and when necessary. This way, all the work is centrally coordinated for one purpose: litigating your case and getting your money back.

Pursuing Your Claim in Court

It’s like fraud cases; even when confronted with irrefutable evidence of their wrongdoing, the guilty party rarely says, “You got me; here’s your money.” You will likely have to claw any money back through the court system to recover it.

Like other types of litigation, real estate fraud claims can take a long time to resolve. As a “white collar” type of case, they can also be quite complicated. That’s when you’be glad you hired an investigator to uncover evidence that will stand up to legal scrutiny.

Pursuing your claim in court may be your only option, but it’s not something you should try to do on your own. Instead, hiring a real estate litigation attorney is the best way to go.

Talk to a Real Estate Fraud Specialist

The most effective way to fight against real estate fraud is to bring in outside help—people who can investigate your case, negotiate on your behalf, and take your claim to court. At Hoffman & Forde, our attorneys have years of experience handling real estate transactions and litigation in California. We know how to uncover fraudulent activity and pursue a resolution that’s fair for you.  Contact our office to set an appointment for your first consultation.