How to prevent property fraud occurring guide, Kent House sales advice
How Buyers & Renters Can Prevent Their Property From Fraud Occurring?
21 March 2022
One of the most common risks involved in the world of real estate is property fraud. With each passing day, fraudsters are finding new ways to scam property owners and renters and making millions from the process. So how can home buyers and renters protect themselves from these fraudulent activities? In this blog, we have put together a comprehensive guide for the prevention of property fraud after consulting the best estate agents in Sittingbourne.
Before we move forward with our discussion about the prevention of property fraud, we need to understand the meaning of the term ‘property fraud’.
What is property fraud?
The value of properties is increasing with each passing day. It can be sold and then be used to bring in a mortgage. This becomes the target of fraudsters.
In the past 14 years, the cases of property fraud have risen to 678 and counting as per the claims of the Land Registry. The average cost of property scams is approximately £107,699 per homeowner, and an overall amount is £73.3 million.
Now, we’ll discuss some of the main types of property frauds and different ways to protect oneself from being scammed. But before that, we need to analyse our risk factors!
In what ways can you become a victim of property fraud?
Unfortunately whoever owns a home or is undergoing the process of purchasing a property can become a target of property scammers. However, the risk of becoming a victim increases in the following situations-
- Empty and unattended properties
- If a property is rented out without proper background checks
- If the owner lives overseas
- If the property does not have any mortgage against it
- If the property doesn’t get registered under the Land Registry
- If the homeowner’s identity is at risk
How can I avoid property fraud?
The first step to avoiding property fraud would be to check the status of your property’s status with the Land Registry. You simply need to pay a £3 charge to check this information and in case of any incorrect info, inform the Land Registry right away. If you come across any property that is unlisted in the Land Registry or hasn’t been sold since 1990, be cautious. Once you sign up for the alert service of the Land Registry, you will receive an email for every official search and application that is received for the property that you want to be monitored.
Although it does not eliminate the fraud and block any changes, if anyone tries to make any changes in the documents of the property you have registered, you will be aware of it. Landlords can make use of this service as well as up to ten properties can be monitored free of cost.
You can also have more than one person to look after one property to minimise the risk of property fraud.
Put up a restriction on your property to avoid scams
Keep your property safe by setting a restriction on the title deeds. By doing so, only an application from your solicitor or conveyancer will lead to the registration or sale of your property.
For people who are residing in the property, an application for restriction costs £40 whereas if you don’t reside in the property and own it privately, an application for restriction is free.
What are the various forms of property fraud?
Estate owners and prospective homebuyers should look out for a few kinds of property scams when buying and selling a house.
Hacking through email
Email hacking can occur when a fraudster intercepts the emails exchanged between a solicitor and a buyer. Personal information such as bank details can be changed by fraudsters to their own whereby the money is sent to their account.
Here are a few tips for you to minimise risk-
- If there is a discrepancy in the bank details sent to you by your solicitor via email and via post, make sure to call them and verify.
- Be cautious when choosing a solicitor or conveyancer. Check whether the firm is genuine.
- Read the documents provided by your solicitor very carefully.
- If you are being rushed by your solicitor, you need to proceed with caution as fraudsters often use this trick so that you don’t read the emails carefully and they can benefit from the transaction.
Be wary of the countless investment scams which lure people in with their ridiculously high returns. It can be for a plot of land that is being marketed as a potential investment. But in reality, it may not even exist. Another common investment scam involves companies asking investors to put their money in rented Be wary of the countless investment scams which lure people in with their ridiculously high returns. It can be for a plot of land that is being marketed as a potential investment. But in reality, it may not even exist. Another common investment scam involves companies asking investors to put their money in rented properties and earn good returns. This house will later turn out to be in bad shape and unoccupied- making it unfit to be rented.
Always do your research to avoid any investment scams. Check the company first, and if any deal seems too good to be true, don’t hesitate to walk away. Talk to locals about the history of a land and check planning permissions. Have a conversation with the council and keep copies of all paperwork.
Some other property scams include-
- Companies offering a quick sale and offering you a significantly lesser price at the last minute before the sale.
- Online shopping for properties advertised on eBay where the seller isn’t the legal owner.
- Holiday homes are also falsely advertised as permanent residences for people to buy.
How to prevent property fraud occurring – Bottom Line
Homebuyers and renters need to be extra cautious when it comes to buying a property and renting out properties to avoid any potential scams. We hope with our guide to the prevention of property scams, potential homeowners and renters will be able to save themselves from property fraud. If you think that you are a victim of property fraud, get in touch with the Land Registry immediately. Speak with their trained staff for more guidance as to what can be done next.
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