Savvy scammers are always on the lookout for a way to swindle money from unsuspecting victims, and the real estate industry is by no means off limits. Of course, the overwhelming majority of buyers, sellers, agents, landlords, and others involved in real estate transactions are honest, but there are a few bad apples out there who spoil the bushel.

Considering how much money is being played with in a real estate transaction, it’s critical to get educated on the normal steps in the process in order to be able to spot a scam in the works.

Luckily, there are plenty of warning signs that will present themselves that will give you the opportunity to take yourself out of harm’s way before you get scammed. Here are some red flags to watch out for so you don’t get scammed, which typically come about when you’re not being represented by a real estate agent.

Investors Using Questionable Marketing

You’ve probably seen them before: signs plastered to anything stable, like a light post or mailbox, that say something along the lines of, “We Buy Houses.” Legitimate, professional real estate agents or investors are not in the business of advertising their listings illegally or in poor taste. If the type of marketing that you see when it comes to real estate is free, it’s highly possible that it isn’t legitimate.

Foreign Buyers Promising to Pay All Cash Without Seeing the Property

While it’s common for foreign investors to buy into the US real estate market, they usually do so with the help of an agent representing them on home soil. Details about the property will most likely be provided, including photos of the interior and exterior, and all the financials will be handling legitimately through a financial institution or an accredited attorney.

You should already have your back up when it comes to dealing with foreign buyers, especially with money laundering being a real issue. But a buyer from out of the country offering to buy your home in cash on the spot without asking much about the property is a red flag. Most people who are spending big bucks to buy a property will want to see it, or at least have their local agent pay a visit. Scammers won’t, and likely won’t even ask any questions about the property.   

Buyers Giving Too Much Information

Most people would be hesitant and careful about providing sensitive information about themselves, especially financial information. For this reason, you should be very skeptical of a supposed buyer who is offering up detailed information even when they’re not being asked for it. This is especially true if all this info is being shared via email.

Many times scammers will take a snapshot of various types of financial records, such as a bank statement, and email to potential victims. They’ll also list a host of contact information, including phone numbers, email addresses, mailing addresses, and so forth. Providing all this information makes them look like they’re the real deal. And they’ve got nothing to lose, because all that info isn’t even real, anyway.

Overly Eager Buyers

Many times legitimate buyers will fall in love with a home and decide to pounce on it before anyone else can. Such scenarios are common, and totally legit. But scammers who either call or email you expressing their interest in buying your home, and are overly zealous about snagging it should be handled with extreme caution. If they seem way too excited about sending a down payment or deposit to their lawyer without even haggling the purchase price, you’d be well advised to quash the transaction before it even starts.

Scammers Claiming to be Agents Who Are Owed Commissions

Some scammers try to haggle commission money out of sellers, even when no real estate agent has even entered the picture yet. Many con artists will attend an open house and gather up the seller’s contact information. Once they’ve got it, they’ll contact the seller pretending to be a real estate agent for a supposed interested party, and will try negotiating a price on behalf of their ‘clients’, including the commission.

You don’t have a business relationship with this individual, nor do you have a signed contract outlining the fact that this person is representing you as your agent in the transaction. Nor is there any contract being presented to you detailing the fact that this person is representing the buyer, as well as the commission structure. The moment you are told that you need to pay commission fees before a sale has even been made, you should hang up the phone.

The scammer may even go so far as to threaten to sue you for a “finder’s fee” for bringing a supposed interested buyer your way. No evidence has been provided that there actually is a real bonafide buyer, nor has any transaction even been made. This is where all communication with this individual must cease.

Requests to Wire Money

Anytime you hear the words “wire money” come up in a conversation with someone you don’t know, run. The majority of scams involve funds that have been wired. Scammers will come up with a host of compelling reasons why money would need to be sent tough a wire transfer rather than through a bank or lawyer.

Scams like these can happen whether you’re on the buying or selling end. If you’re selling, scammers will wire you their deposit, then request some of it back because they “accidentally” overpaid. In this case, you’ll send the money, and never hear from them again. If you’re buying, the supposed “seller” may ask you to wire the deposit money to them because they either don’t live in the country or are currently unavailable to receive the money any other way. Regardless, wire transfers have no place in a real estate transaction.

Scammers are everywhere, and they typically present themselves as legitimate professionals who know how to put on a good act. When it comes to money matters, always err on the side of caution, especially if your gut tells you something isn’t quite right. 

Spring has notoriously been prime time for the real estate market, and in certain centers, it’s been a particularly heated one for a while now. With an improvement in the labor market over recent months already playing its part in driving the housing market, experts believe many other trends will add fuel to the fire.

1. Mortgages Are Easier to Obtain

Right after the housing crisis over eight years ago, lenders seriously tightened the noose when it came to lending criteria. As a result, it became extremely difficult for borrowers without stellar credit to even be considered for a mortgage. While lenders implemented stringent underwriting standards in an effort to protect themselves from potentially delinquent borrowers, they also made it tough for the average homebuyer to obtain financing to secure a home purchase.

But these days, mortgage approvals are much more common. According to Ellie Mae, over three-quarters of mortgage applications were approved in March, up from two-thirds from the same time last year. With more relaxed lending requirements, borrowers will find obtaining a mortgage a lot easier today than they did years ago. And with interest rates still being as low as they are, mortgages are still relatively affordable.

2. Inventory Continues to Be Tight

Despite increasing property values across the US enticing homeowners to make a pretty penny off the sale of their homes, inventory continues to be tight. This is especially true for starter homes and new construction.

With a reduction in the number of distressed homes popping up on the market for sale, combined with fewer new homes being built, inventory will likely continue to experience a squeeze. Despite home builders erecting approximately 650,000 new single-family homes in 2015 – a high since the housing market crash – it’s still way below the average. Demand for new homes is simply not being met just yet.

3. The Hottest Housing Markets in the Country May Soon Hit a Plateau

The exponential rise in home prices, especially in centers like San Francisco and Seattle, can’t be sustained forever. At some point, something’s got to give. After an extended period of time of double-digit price growth in many markets, things appear to be nearing a plateau.

The worries of a housing bubble are not as prominent as they were months prior, as buyers of homes in these markets either purchased with solid financing or even fronted all-cash to complete their transactions. As such, a repeat of bulk foreclosures is not expected.

4. The ‘Burbs Are Becoming More Attractive

As home prices and rent rates in urban hubs skyrocketed over the recent past, an increasing number of buyers have been looking to the outskirts of the suburbs to plant their roots. According to the Bank of America Homebuyer Insights Report, over half of buyer’s in today’s market are considering buying single-family dwellings outside city centers. But these buyers are also looking at suburbs that still offer urban-type amenities, including public transit and employment opportunities.

5. Affordability Continues to be an Issue

While wages have been slightly increasing recently, they aren’t keeping up with the increase in average home prices across most parts of the US. For this reason, many Americans are continuing to find it a real challenge to be able to afford a home purchase. So far this year, average Americans spend over 30% of their income on home loan payments; that number has been steadily increasing from 26% in 2015, and 22% in 2012.

6. Rent Prices Continue to Soar

Those who are looking to get into the real estate market today might find it tough to choose between renting and buying, considering the high prices of both. While housing affordability continues to be an issue for many Americans, rent prices are following suit. Median rent prices across the country are up 2.8% from April 2016, and now sit at $1,300 for a two-bedroom apartment.

San Francisco is the most expensive city for two-bedroom rental units, with a current median price of $4,690, with New York City coming in second with a median price of $3,400 for two-bedroom units. If rental inflation doesn’t slow down soon, or if wage increases don’t pick up the pace, we could be seeing more Americans looking to buy in the near future. Despite the higher price to buy, purchasing may seem like the more affordable option compared to how much it costs to rent today.

The spike in median home prices has certainly been a strong driver of housing markets across the US lately. Despite an increase in wages over recent months, median home price increases are still winning the race. It will be interesting to see if and when prices finally reach their peak and level off, helping to make housing more affordable for the average wage earner.

Just because your name is on title of the new home you’ve purchased doesn’t necessarily mean that no one else has any legal right to a portion of your lot. It’s called an easement, and it can give your neighbors and other entities a right to access a certain part of your land in some circumstances.

Imagine making one last visit to a home you’ve just agreed to purchase, only to see the neighbor in the back cutting through your driveway to get access to the road. While you may initially assume the person is trespassing, he may actually have the right to cut through if an easement exists.

Before you agree to buy a home, it’s in your best interests to find out if there are easements on the property (which there most likely are), and understand all there is to know about them.

What Exactly is an Easement, Anyway?

Simply put, an easement is a legal right given to cross or use another person’s land for a specific purpose. The key here is the “specific purpose,” which needs to be defined in detail. That means that your neighbor can’t arbitrarily put his patio furniture or start a vegetable garden on your land. The easement doesn’t give a person the right to possession; instead, it only gives the right to use it for specified intentions.

Stated otherwise, when a person or entity is granted an easement, only the legal right to use the property is granted, but title to the land is still retained by the owner. Easements are more commonly granted to utility companies, such as telephone or electrical companies to run cable and power lines. But sometimes easements can be granted to neightbors who need to cross through your land in order to access the street.

Three Main Types of Easements

Just about every property has an easement. As a property owner, you have the right to know what type of easement your land is attached to, and how it will affect the enjoyment of your property.

Easement in gross. The rights of utility companies to step foot on your property, as described above, are common, and are referred to as easements in gross. This is the most common form of easements, which grant utility companies the right to enter a property at no charge to provide their services. The majority of these easements are known about and easy to detect, such as easements for telephone and cable lines, and are typically discovered through a title search. But sewer and water lines aren’t always known about and are often discovered after digging starts to put in a swimming pool, for example.

If easements are discovered this way, and were not disclosed to you when you purchased the property, any reduction in the value of your home (should that occur) may be compensated through your owner’s title insurance policy. If the easement was known to the city and properly recorded, but you weren’t informed of it when you bought the place, the title insurance provider is obligated to pay you for any loss of property value as a result of the easement.

Easement Appurtenant. This type of easement can’t be transferred when the property sells, and as such, these easements are said to “run with the land.” That means that they’re part of the land’s ownership, and can’t be transferred with the seller upon the sale of the property. Easements for driveways, sidewalks and roads and sidewalks over a neighbor’s land, for example, fall under this type of easement.

Let’s say your neighbor is granted an easement appurtenant in order for him to access the roadway from his driveway. When he sells his property, the new owner will have the same limited right to cross your land to get to the street. The current and future owners can’t use your property for any other purposes other than to access the road. This type of easement should have been communicated to you when you bought your home, so you know that your land will be used in this manner, and you won’t be unpleasantly surprised.

The majority of easements appurtenant are created by an agreement between property owners or when a subdivision is created. Sometimes landlocked parcels of land that have no access to roadways are subject to an easement appurtenant by necessity over an adjacent piece of land. In this case, it needs to be proven that at some point in the past both properties were privately owned by the same person or entity.

Prescriptive Easements. These types of easements are the ones that cause the most animosity between neighbors, since they are created without the permission of the owner who’s property is being used. The use of prescriptive easements can be shared and don’t have to be exclusive, which means property owners are often not aware when a neighbor is granted the easement.

To illustrate, let’s say your neighbor builds a fence along what is assumed to be the boundary of the property. A few years pass, and one day your neighbor serves you with a quiet title lawsuit in an effort to establish a prescriptive easement to that portion of the land. After obtaining a survey, it’s discovered that your neighbor actually constructed the fence 3 feet into your side of the property’s boundary, and is now entitled to a prescriptive easement.

After the required number of years of hostile use have passed (depending on the state), the neighbor can legally acquire a prescriptive easement. The key here is that a hostile environment has to exist; a prescriptive easement can’t arise if you give permission for your neighbor to use and take that portion of the land.

What Are Your Rights?

If the house you buy comes with an easement, you’ll have to comply. If your new property is the only access that your neighbors have to the street, you can’t legally block them from getting there. If you did, you’d be considered to be trespassing on an easement by necessity, and you can even be slapped with a lawsuit.

Do Easements Limit Your Ability to Make Improvements on Your Home?

You’ll definitely want to be in-the-know if you plan on putting an addition to your home or building deck. If you erect a patio over top of a portion of the land that a neighbor is legally allowed to cross through to gain access to the street, not only could you be forced to take it down, you could also wind up in court. That’s why it’s crucial to find out if there are any easements on a property before you decide to buy it.

Can You Fight an Easement?

You might be able to successfully challenge an easement, but only if the circumstances are right. And be prepared to take the battle to court. It could be a simple matter if the holder of the easement – such as your neighbor – agrees to terminate the easement agreement. Sometimes easements might also have an expiration date, after which it no longer exists.

But many other times it can be tough to challenge an easement, particularly when it comes to prescriptive easements. These types of easements may be able to be challenged by claims that the part of the land was abandoned. If that’s the case, you’ll probably want to speak with a real estate lawyer for advice.

When you agree to buy a home, it’s in your best interests to find out everything there is to know about it. Just as important as it is to have a home inspector on the job to uncover any physical defects, it’s just as important to find out if any current easements will compromise your enjoyment of your new home.