How is the market? Stay alert to avoid scams – The Ukiah Daily Journal

(Contributed)

Recently, I was reminded of a scam where the scammer tries to sell a property that he doesn’t own. It works like this: The scammer finds an unoccupied property and checks public records to see if there are any loans or liens on the property. If there aren’t, and the deed was recorded decades ago – especially if the owner doesn’t live in the area – the scammer steps in.

He contacts a real estate agent and requests that “his” property be offered for sale at a price below market value because he wants to “generate immediate interest.”

He doesn’t want a sign on the lawn, but he does want a cash sale with a quick escrow. He says he can’t meet in person because he’s caring for his sick Aunt Mabel. In fact, he needs the proceeds from the sale to cover the cost of her care. He can call, but he can’t video conference because reception is poor or the webcam is broken. (The scammer wants to avoid anyone being able to identify him, and he definitely doesn’t want a photo available to law enforcement after the scam.)

The property attracts buyers who could not afford the price; they take the opportunity to make a bid. The scammer accepts the first offer, but says he cannot sign in person (again, because he cannot leave poor Aunt Mabel alone), so he promises to provide a notary for all the necessary documents for the land registry company.

Most title companies prefer to work with well-known notaries because they fear fraud. However, if they can’t work with someone they know, they will accept verified credentials. Unfortunately, it’s not too difficult to forge a notary’s credentials. If the payout is high enough, a scammer will spend the money on a high-quality fake.

Once the documents are delivered, the scammer demands that the proceeds from the sale be sent via wire transfer rather than sending a check to a specific address (electronic transfers are harder to track). Unfortunately, the scammer is long gone before anyone realizes what happened. Often, no one notices until the property owner inquires why she hasn’t received a property tax bill, only to discover that she is no longer listed as the property owner.

Who loses in this transaction depends on the specifics. Since this was a void sale, the title will be returned to the original owner. If the buyer transacts through a title company, they’re fine. If the buyer gives in to the fraudulent seller’s demands and doesn’t use a title company, they’re the big loser. If a title company is involved and didn’t catch the fraudulent notary, the title company will take the financial loss. You can see why title companies are so fussy about the idea of ​​fraudulent transfers.

Several years ago, a real estate agent was hired to list an apartment complex. The agent met with the owner, Joe, who lived in one of the apartments on site. All of the tenants greeted Joe warmly, saying he had been a great landlord for years and that they were sorry he was selling the property. Joe assured them he was looking for a buyer who would treat the tenants well. While the agent was showing the property, Joe pulled him aside in a panic, saying he had lost his wallet and didn’t know what to do.

The agent was also a notary and told Joe not to worry. He trusted him and wouldn’t ask Joe for identification. After escrow was completed and Joe left town with his $14 million proceeds, the actual owner contacted the tenants to find out why he was no longer receiving rent checks. As it turned out, Joe was the on-site property manager, not the owner. He had been lying to the tenants for years.

The moral of the story is: trust is better than control. Pay attention to every detail and if there is a delay because someone is double-checking something, sit back and relax because it is better to be safe than sorry.

If you have been the victim of a scam, please report it immediately to local law enforcement. It can happen to the best of us, especially if you are not regularly involved in real estate transactions. If you suspect that a real estate agent has been involved in a scam in any way, please contact the California Department of Real Estate.

If you have any questions about property management or real estate, please contact me at [email protected] or call (707) 462-4000. If you have an idea for a future column, share it with me and if I use it, I’ll send you a $25 gift certificate to Schat’s Bakery.

Dick Selzer is a real estate agent who has been in the business for over 45 years. The opinions expressed here are his own and do not necessarily represent those of his affiliated organizations.