Expand / Collapse search
☰

AG Dana Nessel warns against real estate scams: What to know

By FOX 2 Staff
Published  March 22, 2024 4:13pm EDT
Crime and Public Safety
FOX 2 Detroit

FOX 2 (WJBK) - Michigan Attorney General Dana Nessel is sounding the alarm when it comes to real estate scams. 

With an increase in fraudulent real estate listings on properties that often do not exist, renters and home buyers should be aware of the warning signs.

An advertisement on Zillow listed a Florida house at less than 3% of its actual value, according to a news release from Nessel's office. The listing "agent" specified they would only engage with first-time home buyers who did not have any representation. Moreover, they demanded a deposit of $4,500 before the house could even be viewed.

"Purchasing a home is often the single largest expense a consumer will make in their lifetime, and entering a new lease on a rental home likewise represents a huge financial commitment," Nessel said in the release. "Sadly, when the sums reach such heights, fraudsters and scammers are drawn to these markets. Prospective homebuyers and renters can avoid falling victim to these scams with moderate vigilance and reasonable precautions, and a healthy skepticism of any listings that appear too good to be true."

Nessel's warning refers to Zillow's guidance on what prospective home buyers should be vigilant about. Beware of:

  • Requests to transfer funds: Most scams typically request funds to be transferred via Western Union or MoneyGram, or through payment applications such as Venmo or Cash App. One should never transfer or receive money from an individual they never met in person.
  • Landlords that are overseas: Numerous scams originate from individuals abroad who claim they are interested in purchasing or leasing property in the United States.
  • Requests for verification codes: Do not share any verification codes with scammers, as they can use them to hack into your account or device – leading to more scams.
  • Demands for personal or financial details: Never share your bank account details or Social Security with anyone that is not verified by you.
  • Grammar or spelling errors

Renters should look out for similar red flags. The following tips are from the Federal Trade Commission (FTC):

  • Do a web search: Look up the name of the property owner or rental organization along with phrases such as "complaint," "review," or "scam" to find any experiences reported by others..
  • Inspect the prices of similar properties: If the price seems significantly lower than other similar units in the same vicinity, it could potentially be a scam.
  • Examine the property thoroughly: Before signing or making any payments, ask to look at the property virtually or in person. Request the agent's business card issued by the owner or manager to verify their identity and ensure it matches the company's records.
  • Never provide any personal or financial information: If contacted by someone claiming to work with the owner or rental firm, do not share any personal details. Instead, contact the owner or property management company first.
  • Never pay in cash: If a person insists on payment via cash, wire transfers, money cards, or cryptocurrency, consider it a scam. These modes of payment are the same as cash transactions. Recovering the funds once sent is typically difficult, if not impossible.

Anyone who believes they have fallen victim to a rental or real estate scam can report the incident to their local law enforcement authority, the FTC, the website that hosted the advertisement, and/or the Department of Attorney General’s Consumer Protection Team found here.