Avoiding Homebuying Scams and Costly Deals

Homebuyers, especially those with credit challenges, are frequent targets of scams and high-cost deals. A few habits protect you.

Red Flags

• Emailed or texted wiring instructions that change at the last minute
• Rent-to-own contracts where you lose everything if you miss one payment
• Owner-financing deals with high rates, balloon payments or no title protection
• Pressure to sign quickly or skip the home inspection
• Anyone who asks for fees to 'guarantee' approval

Protect Yourself

• Always call your title company at a number you look up yourself before wiring money
• Have a real estate attorney or HUD-approved counselor review any rent-to-own or seller-financing contract
• Make sure the deal closes through a licensed title company with title insurance