Potential real estate investors may have heard or experienced unusual sales pitches or advances, such as offering buyers the opportunity to learn how to become real estate investing millionaires by offering questionable fees, perks, or add-ons.
Be on the lookout for scam real estate broker. However, not all real estate investing seminars or brokers are bad bets, of course. There are many who will help you learn about the investing business and may be an expert worth asking for a reference.
The US Federal Trade Commission has recently issued advisories to consumers to be wary of claims that money can be made quickly and investment grows rapidly in the short term, despite a lack of experience, and that making money using the broker’s faulty formula is not really a sure thing.
The number of seminars offered by real estate brokers to prospective real estate investors has skyrocketed along with the boom in the real estate market. These seminars are distinguished from professional or academic courses that focus on specific topics, such as real estate demography.
It’s not unusual to see advertisements for public seminars that promise to teach you all about the art of buying real estate, in as little as three days. Such seminars are usually free and are intended to entice you to pay for additional knowledge at future conferences.
Real estate agents have a valuable source of potential business for the real estate investor in the Multiple Listing Service database. Be careful, though, as only real estate agents have a monopoly on this information, so staying on top of such a list can be a necessary part of an investor’s game plan.
As an investor, it can be difficult to deal properly with real estate agents. Most agents would prefer homebuyers with cash on deposit, good credit, and conventional purchasing power. Their main interest is to earn a commission with as little hassle as possible. Most agents have never done a creative real estate transaction with an investor, so they are not receptive to unusual offers. Most agents equate a no-down offer with a non-serious buyer.
Here are some tips to keep an eye out for scam brokers.
Stay away from intimidating and uncooperative broker types
If you can’t keep your voice down with a bossy runner, don’t be afraid to stand up to him. Some brokers are unethical and often refuse to submit your offer. Also, many times the broker will lie and tell you that his offer was rejected when, in fact, it never came. If this happens, don’t be afraid to bypass the listing broker. If the listing agent is uncooperative, deal directly with the sellers themselves and bypass the middlemen.
Offer a short closing date to your broker
Another way to get an agent to take you seriously is to offer a quick closing time. Nothing makes an agent drool more than the thought of receiving a commission check in ten days. If the agent is presented with another offer, he will usually advise his client to accept the offer with a larger bond and faster closing than an offer that is priced higher.
Insist on doing your own calculations
Sometimes you’ll get the other end of an uncooperative broker, ie an overzealous broker. Be suspicious of any broker who tells you what deal he is getting on a property. If it was a good deal, then why didn’t he buy it? Don’t take the broker’s word for value. Request printed copies or information on comparable sales.
Please note that the information contained in the MLS database was entered by the listing agent and may be falsely entered. If a comparable sale lists the same square footage as the home you’re looking at, try visiting the area to see if it’s really accurate. Do your own property value assessments.
Real Estate Press – http://realestatepress.org