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6 Tips to Avoid Home Investor Scams for Inherited Properties
Inheriting a property can be stressful. Whether you’re stuck with a property that needs repairs or the inheritance is straining family relationships, selling quickly can take the burden off your shoulders.
Selling to an investor is a quick and easy way to sell your inherited house, but in such a risky market, you need to be mindful of house-buying scams.
This article highlights important tips you need to know to avoid home investor scams.
1. Seek Local Investors
Knowing to whom you are selling is the best way to avoid home investor scams. There are no certifications or licenses required to invest in real estate, so you will need to rely on your research to find a reputable investor.
Online sources are not always the most reliable, and meeting with local investors face-to-face can help determine their credibility. Additionally, housing markets and laws vary from state to state, so a local home buyer in Texas, for example, will know your market better than anyone else.
Working with an investor who knows the market and local laws will also ensure you make it to closing with no time wasted and no empty promises.
2. Research Your Investors
Once you’ve narrowed down your options on potential home investors, it’s important to research their credibility.
Membership with the Better Business Bureau (BBB) indicates that a company is well-established, but unlisted investors may still be reliable, provided you can find other ways to vet them.
That being said, their membership is a good indicator that you will avoid falling victim to house-buying scams. The BBB provides evidence of awards related to customer satisfaction, further solidifying investor credibility.
If you cannot find any information on the investor online, looking at alternative options could save you from a potential scam. Check review sites and as previously mentioned, refer to the BBB for information on potential home buyers until you have a list of reputable investors.
3. Never Pay For Services Up Front
Some scammers may present enticing offers for your home, but they will also ask for a fee to view the property. While their fees may not seem like much when compared to the offer, there is no reason you should pay anything to a buyer, especially if you are selling for financial relief.
Legitimate investors and home buyers will never ask for payment for consultation or appraisal services. If you are being asked to put up money when selling your home, look for more reputable buyers.
Fake Inspections
House-buying scams will use home inspections as a way to get money from you.
In standard real estate transactions, the responsibility for covering the cost of a home inspection falls on the buyer. If you are asked to bear this expense, they are attempts to overcharge or engage in fraudulent practices, such as employing an illegitimate home inspector to retain the funds.
Exercise caution when confronted with such requests.
4. Be Wary of Eagerness to Buy
Legitimate investors and home buyers want to buy homes, but not without seeing them first. Another way to spot a potential scam is if the buyer is unusually eager to buy your inherited property.
These fake buyers will make an offer on your property without meeting with you in person. They may present a higher offer than what you are asking and make promises to wire money into an account or send a cashier's check — these are signs of a wire fraud scam.
While there are cases in which investors buy homes remotely, they will most likely want to send an agent to tour the property and virtually guide them through it.
Reputable home buyers like Big State Home Buyers will buy homes in any condition, but we still do our best to conduct an assessment before we make an offer.
5. Watch For Additional Fees
Home investor scammers will attempt to incorporate fees into their offer. Remember, experienced home buyers like Big State already account for things like repairs, liens on your inherited home, and selling without a will.
Falling victim to a home-buying scam can mean a less-than-fair cash offer if you receive payment. Local home buyers are often a safe and fair way to sell your inherited home.
6. Pay Close Attention to Payment Timelines
Reputable home buyers like Big State pay for your home’s full amount in cash at closing. Home investor scams can be quickly identified if a buyer cannot guarantee prompt payment, a primary reason you may be selling your inherited home to an investor in the first place.
Identifying “Bird Dogs”
If you are unsure whether an investor is legitimate or not, you can ask for a nonrefundable deposit on the purchase. This is called asking for “earnest money”.
Earnest money is not additional money paid for your home, but rather an advance to build trust. If an investor expresses hesitation in providing earnest money, they most likely do not have the money to buy your home and are acting as a middleman for other potential investors.
Big State Home Buyers will put down earnest money, no questions asked.
Ultimately, Trust Your Gut
There are identifiable patterns when it comes to spotting house-buying scams, but that does not mean you will catch them all. We understand selling your inherited home is stressful and can impede decision-making, but remember to trust your gut.
If you feel like something is off when interacting with a potential investor, you may have already identified the scam. In this case, it is best not to move forward with the deal and find a more reliable home buyer to sell your inherited home.
Selling your home to an established home buyer is the best way to avoid a scam and will relieve you of any stress that comes with selling on your own.
Sell Your Inherited Home Confidently
Engaging with a practiced investor is crucial in avoiding home investor scams. A credible home buyer reduces these risks further.
At Big State Home Buyers, we specialize in buying inherited properties quickly and for a fair price. With a substantial track record and having won the BBB Award of Distinction & Pinnacle Award for Excellence, we pride ourselves on being a seasoned and reliable team.
Reach out to us today for a fair cash offer.
