Latest Real Estate Scheme

Today a large percentage of homes on the market for sale are foreclosed properties owned by banks, also known as REO's. Because they have been foreclosed, all of these homes are vacant and have lock boxes on the front door with the keys inside them. It is very easy for Realtors, appraisers, etc to get the combination to access the keys. To make it more convenient for accessibility, most banks use the same codes for all of their properties. If a person in the real estate industry knows a property is for sale by a particular bank, the odds are that they can get into the home without giving any of their information to any one. Due to this, a new real estate scheme has surfaced.

The real estate scheme works the following way. The crook gets a list of homes owned by a particular bank thru the MLS (multiple listing service) without giving any personal information. Since he knows that bank's lock box codes, he drives by these homes and previews them by himself. He will try to find a home that is in fairly good condition and also in a remote area without too many neighbors. The crook will also make sure that this home will be one that probably won't have that many showings. The next step is for the for sale sign to be removed. A rental ad for that home will be listed in the newspaper or somewhere else with a contact number for the crook. This number will be a number that will later be disconnected when the scam is over. The rental price will be a very good value for a potential tenant. When the tenant meets up with the crook, the crook tells the person that he can discount the price even more if the person pays his upfront money (first month, last month, and security deposit) with cash instead of a check. The tenant pays the upfront money in cash, signs what turns out later to be a meaningless lease, and moves in. The crook takes the cash and vanishes into thin air, never to be heard from again. Eventually the bank finds out that their home is not selling and that someone is living in it.

The bank can't just tell the person to leave the home. Because the tenant is a victim of a crime and has established that home as his residence, the tenant is entitled to an eviction process, which could take the bank many many months to resolve.

The reason I am writing all the steps to this real estate scheme isn't too teach someone how to be a crook but rather how important it is to use an experienced, trust-worthy Realtor to do a background check on a rental property. A good Realtor will check and make sure that the property is actually owned by the landlord, check to make sure that the landlord isn't past due on the mortgage or in foreclosure trouble, and check on many other things.

Amit Bhuta
Real Estate Helper
Kendall Village Homes
(305) 439-3031
www.DadeCountyMLS.com