Perhaps the most important aspect of my job as a realtor and real estate broker in New Jersey for over 20 years is protecting and guiding buyers through one of their most important and expensive lifetime purchases—their family home. With our current market conditions and super low inventory, many buyers are anxious to find a house, which is causing a record number of bidding wars each time a new house pops up on the market.
In my opinion, this trend will not change this year. There is market data to show prospective buyers refreshing real estate apps and sites multiple times a day to see if anything new has come onto the market. When supply enters the market, the demand is so great that it turns into a feeding frenzy — even as interest rates climb.
This demand leaves the market wide open for scammers that pry on emotional buyers — even the savviest of shoppers may fall victim to a fake FSBO listing.
An FSBO listing offers none of the due diligence that the realtor community puts into their services before presenting the home to market. When a realtor represents a property, you can be confident the correct information is being used to market the house and there is signed paperwork by the owner giving permission to list and market the house. Most importantly, the seller is vetted to make sure they are the proper owner of the parcel.
However, in recent weeks throughout Bergen County, specifically in our local Teaneck and Bergenfield area, there have been a few FSBO properties that have been fraudulently listed by someone claiming to be the rightful owner. This is a well-known scam nationwide that is affecting the industry and all the professionals working in it, not to mention the heartbreak of consumers when they realize their dream home or piece of land that they paid for isn’t theirs, and now they will be tied up in court trying to reverse the damage.
These scammers have been getting really good at making the sale look and sound real. The blueprint for this scam is: First, they find a property or house that has an out-of-town owner or a vacant parcel of land that the owner isn’t watching. Then they look up the owner’s name (which is all public record) and use this information to post the property for sale using FSBO sites. These scammers impersonate the sellers by adopting their persona — using their name, a prepaid cell phone and fake email address. They hire unwitting attorneys to represent them, show fake ideas, and have a notary on the inside notarize the deed and send it to the title company. Normally, they try to get the deposit money wired to them in an overseas bank account and then close as quickly as possible so that they can get the money and run.
These fraudsters are using FSBO websites, as well as Zillow, because it allows anyone to list a property without any verification of who they are or whether what they are selling is real. Buyers and even agents call to show the properties and present offers. Usually, the agents who are up to date with industry best practices know the red flags and use professional resources to make sure the FSBO listing is real. However, most buyers don’t know what is happening and become confused and frustrated at the process. They are just focused on the emotional side of getting a property and want to secure it quickly so that they don’t lose it to someone else.
These FSBO sites help facilitate fraud and, as a buyer, you should beware of any “deal” that you see presented on these sites. While buying a legitimate FSBO can be successful in some cases, it often requires a significant investment of time, effort and expertise so that your transaction goes smoothly. A buyer’s agent is here to protect you throughout the process of any purchase, including an FSBO, to make sure that you are legitimately buying the perfect home or land for your family.
To protect yourself from this scam, work with a good local professional agent. His or her expertise will usually help you save time and money. From searching for the property to vetting the property information, a realtor is invaluable for any real estate deal. Agents use paperwork that has been provided to them from an overseeing agency like the New Jersey Association of Realtors or from the corporate side of brokerage where they hang their license. You can take comfort in knowing that you are signing what needs to be signed for your transaction.
If anyone feels that they have been taken advantage of in a transaction like this, please make sure to report it to the local authorities, and next time you want to purchase a house please use a realtor.
Marc Stein is a realtor and the CEO of Links Residential a top New Jersey real estate team brokered by EXP Realty. He is a coach, trainer, speaker and leader in the national real estate community. He can be reached at (201) 522-9733 and at [email protected].
