Four Red Flags To Watch When Buying Or Selling A House

You may think buying and selling of a house is a simple and easy thing but, the fact is that this is overwhelming and complex process especially if you are a new dealer in the Real Estate Industry.  Currently, the Real Estate industry is changing randomly with rules and regulations varying from time to time.  As a result, you can easily encounter numerous scams that may lead to money loss. Therefore, you need to clearly understand the transaction conducting is genuine and legitimate.  Below, are the four major red flags in the real estate industry that you must review so that you won’t be swindled

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1. The dual agent

Using an agent who represents both the seller and the buyer is not the most effective interest. Normally, the seller expects to sell the property at the highest price possible while the buyer expects to purchase the house at the lowest amount possible. In that condition, it becomes difficult for the agent to treat both parties fairly. The agent may act fairly to the buyer thus disadvantaging the seller or vice verse.  To mitigate the money loss, you should ensure that the agent is tirelessly working for your best interest. Though the dual agency is legal or allows in particular areas, you should try as much as possible to avoid it. Otherwise, you may face the scam.

2. Ensure the commission is paid

The terms of who should pay the commission are always negotiable, and it is very important to spell it out clearly in the real estate contract. In most cases, the seller’s agents should pay the buyer’s agent the agreed percentage of commission. The majority may not understand who should pay for the commission and therefore, it is critical to have the commission highlighted clear in the contract to avoid the commission scam.

3. Get rich quick

Normally, the real estate investment scams are in two key varieties.  The first form of scam is known as the Ponzi scheme where the scammer tricks you to invest into the real estate industry rather than using the amount to purchase the property. The second scam includes the use of the seminars on how to teach people tips on investing in real estate at a charge. Though the seminars are legitimate, they turn to become scams when the primary purpose of the seminar is to sell expensive books to the attendants as well as charging the coaching fee.

4. The “as-is” sale

If you are an entrepreneur looking to purchase a property for reselling, the “as-is” situation is the best option to use but if you want a house to live with your family, try to avoid that situation. You should effectively weigh all the factors before signing the transfer agreement.  The “as-is” means you are buying the house as it is and you can’t hold the seller accountable for any finances incurred in renovating. However, the situation of “as-is” turns to be a scam when you fail to consider all the factors and seller transfer to you a house under poor condition. That means you will have to incur a money loss in repairing the house.