Interested in working with a local cash home buyer but are concerned you may fall victim to a house buying scam? For most people, their homes are their biggest assets, so when it comes to selling a property, you want to know how to avoid a house buying scam and ways to recognize one.
From local home buyers and investors to big home buying companies, you have your pick of home buyers to work with, but how do you know which ones are legit and will show up on the closing day? Below we’ll cover everything you need to know about home buying scams in Missouri so that you don’t become the next victim.
Spotting a House Buying Scam in Kansas City
Whether your home is amongst the most expensive home sales or requires some TLC- one of the first things we recommend is to do your research when it comes to selling your house. If it’s a big company, we suggest doing as much research as you can on them. Often, we’ll find people have been scammed because they didn’t research the company they were hiring.
The next thing we recommend is to find out if you’re being scammed in Kansas City before signing anything. Make sure you’re going with your gut feeling, and don’t just sign anything without fully understanding it!
How to Avoid Being Scammed When Selling a House
Besides doing some due diligence before even talking to a home buyer, once you’ve narrowed down your search, there are still a few ways to safeguard yourself from a home buying scam. Let’s take a look at some other ways to avoid getting scammed when you go to sell your Kansas City home.
Know Who You’re Negotiating With
Avoid being scammed by following a weeding-out process and making sure you’re clear about who you’re negotiating with. For example, you probably shouldn’t call a number on a sign at a busy intersection that claims, “We Buy Houses, Fast Cash.” Those signs could represent anyone, good or bad, so you should probably avoid giving that number a call.
Ultimately, the home buying company you want to work with has a legitimate website and photos of the homebuyer you’ll be working with. It would also be helpful to find out how long they’ve been in business, how many homes they’ve purchased, and where the closing process is handled, i.e., a legit title company.
Another reason you should figure out who you’re negotiating with is that a common home buying scam is with buyers who either don’t live in the area or live out of the country. They may reach out to you via phone or email claiming that they saw your house and love it and want to buy it sight unseen – which should instantly throw up a red flag! The buyer you want to work with will want to see your house in person, or the bare minimum, see photos or ask you to do a video walkthrough. It’s sketchy if a buyer is ok with purchasing something so expensive as a house sight unseen.
So to counteract any scams, know who you’re negotiating with, and don’t be afraid to ask questions. The home buying company you want to work with should be transparent and not put off by answering any of your questions.
Verify Communications with Buyers
Another recommendation is to be sure you’re contacting the company you’re hiring. It’s important you do this because you can never know if you’re talking to someone legit or not! So one of the first things you can do is verify their contact info, ensuring that the phone and email they are giving you are legit.
You can do this by Googling the phone number and email address associated with the home buyer you’re talking to and seeing what pops up. Professional home buyers have a legit phone number and professional email address. And should be reachable anytime. If you’re always leaving voicemails or emails going unanswered for a while, that’s not a good sign.
Research the House Buying Process
There are many steps involved in the house buying process, most happening before a buyer even steps inside for a viewing. It’s important to research early because you’ll be more confident you’re making the right decision when it comes time to accept a cash offer for your house.
One way to research the home buying process is to narrow your search for companies that buy in Kansas City and look at each page of how it works. After you look over that, reach out to the ones you’re interested in selling to. When you talk with them, ensure their home buying process is the same as advertised on their website. That can give you a better indication of whether the company is legitimate.
Furthermore, you shouldn’t negotiate too much about money upfront. In-home buying transactions, the flow of money should always be towards the seller, not the buyer if the buyer requires you to pay an application or processing fee, even if it’s only a few hundred dollars, don’t! A reputable home buyer doesn’t charge you fees and will make you a free no-obligation cash offer for your house.
Keep Your Information Safe
Make sure you eliminate email correspondence when it comes to sensitive information or closing details. Although email provides a permanent record and an easy way to have everything in writing, this is easy for your information to be unsafe. So, you’ll want to make sure whoever you’re working with uses encrypted emails or some setup that requires additional login credentials to gain access to the communication. For example, the home buyer you’re working with may be legit, but hackers can still interfere with your home sale and steal personal information from an unsecured email.
Below are a few other ways to keep your information safe:
- Ask for Written Documentation of Promises Made by the Buyer
This tip can help you make sure you’re not being scammed when selling your house. A quick way to know if there’s something fishy going on is to ask for written documentation of any promises made by the buyer.
- Check For Complaints Against the Company You’re Working With
One way to check out complaints against a company or vendor is to use the Better Business Bureau. The Better Business Bureau is also available for Missouri.
You can also search for the home buying company on Google and see what pops up. If others have fallen victim to their scam, then there may be warnings online about it.
- Check with the Better Business Bureau
The Better Business Bureau is a reliable resource you should know how to use when trying to identify scams. You can also sign up for their free services and get notifications on your email or phone if anything they think might be worth looking into shows up. Ideally, the home buyer you’ll be working with is a BBB-accredited business with a good rating.
- Review Online Reviews
Another tip that is extremely helpful and informative is to take a look at online reviews. It’s important to take the time to read what honest customers are saying because you don’t want to fall for any house-buying scams! If the company has no reviews, you may want to start looking for another home buyer to sell your house to.
Types of House Buying Scams to Look Out For
We all know that selling a house can be stressful, so finding someone to buy your home as-is, making you a cash offer, and closing on your time frame sounds like a dream come true! But there are some scams you’ll need to watch out for, and if they sound too good to be true, then maybe they are. So the best way to weed out the good from the bad is to learn how to recognize them and avoid them when selling your house.
Below are some of the common types of house buying scams to look out for:
Cash Offer on House Scam
In this scam, you’ll want to be careful with a cash offer on your house, especially sight unseen.
As mentioned earlier, you’ll want to be suspicious if the buyer is pushing a cash offer on you without even seeing your house and is willing to give you the full asking price. Especially if they offer to send the money right away, this could lead to a common home buying scam.
The buyer offers to pay the full asking price, sends you a check, and once you get the check it’s made out for more than the agreed price. So you being a good person, let them know they wrote the check for more than the agreed amount. They apologize and blame it on some clerical error and just ask that you send the difference to them via wire transfer. So you do, and then you find out that their check doesn’t clear, and you’re out several thousand dollars. Sadly, this particular home buying scam is prevalent.
Remember that scams come in all shapes and sizes, so just be cautious and trust your gut instinct.
We Pay Cash for Houses Scam
Remember earlier; when we mentioned the flow of money in home buying transactions, it should always flow to the seller, not the buyer. The same goes for the “we pay cash for houses scam”; the keyword here is “we pay,” and nowhere does it say “you pay.” Even if it’s a few hundred dollars, you shouldn’t pay a dime for an offer on your house, and you should be under no obligation to accept the offer. A reputable “buy my house Missouri” homebuyer will make you a cash offer for free, and you’ll be under no obligation to accept it unless you want to.
Wire Transfer Scam
When we’re selling a house, you need as much money as you can get, so often, the buyer wire transfers the money you need for the purchase. However, we’ve seen people be scammed out of the money they were expecting to receive when they collect it. To avoid this problem, we recommend never sending or accepting any money until you can verify the transfer is accurate with your bank.
Scams like this are hard to spot, but you can avoid them by being cautious about who you trust when selling your Kansas City house.
If you don’t have enough information, you may decide you aren’t comfortable with the deal, even if you’re trying to sell a house quickly and need that money as soon as possible.
What to do if You’re Scammed When Selling Your House
Usually, people are embarrassed to say they’ve fallen victim to a real estate scam. But the best way to stop the person from scamming another unknowing victim is to file a complaint.
If you think you’re being targeted in any scam related to your Missouri house, it’s essential to take steps to notify the proper authorities. A good place to start is with the FTC. When you file a report with the Federal Trade Commission online, it’s entered into a database that reaches local, state, and federal law enforcement agencies.
You can also file a complaint with the Better Business Bureau’s Scam Tracker, which will help notify others about potential fraud activities. Furthermore, if you want a better chance at connecting with an individual to hear your complaint, consider contacting the Missouri consumer protection agency, as well.
After you’ve been scammed, you’ll likely need to do more than simply file a complaint, mainly if the scam has involved any of your private information (checking account numbers, social security number, driver’s license number). IdentityTheft.gov is the government’s online portal for anyone worried that a criminal is acting on their behalf.
Remember that selling a home isn’t the only target of scams, either. Be sure to be on the lookout for money scams that target your financial accounts.
Hopefully, this has helped you with this process by providing some tips on the dynamics of the scams. Most people know that selling a house can be a very stressful event. We want to make sure you’re doing your best to avoid being scammed at all costs, and we hope we have helped you, too. We’ve provided some helpful tips on how to spot a house-buying scam in Kansas City, and we’ve shared our insight on how to avoid them when you’re selling your home. With these tips in mind, you can be sure that you’re able to keep from being scammed and get the most you deserve for your property!
KC Property Connection is one of the top home buyers in Missouri and is a BBB accredited business. So if you’re interested in working with legitimate house buyers in Kansas and Missouri, contact KC Property Connection today!