A person that has to list their home with a Venice short sale agent is usually someone who is right in the middle of financial hardship. Sadly, people that are going through a tough time seem to be the ones that are preyed upon by scam artists all the time. Your Venice short sale agent wants to make sure that you are aware of some of the more common forms of fraud with short sales so that you can prevent them from happening to you.
The first kind of fraud can actually come from a Venice short sale agent which is why it is important to always get an agent that you can trust. As part of many short sale deals, the commission of a Venice short sale agent is cut and so the agent tries to regain some of their losses by trying to work with the seller outside of escrow. As a buyer or seller you should understand that all commission that comes to a Venice short sale agent will come through escrow, and it is not legal to ask for additional funds outside of that venue.
Another common scam is called “flopping.” This is a form of fraud that involves a buyer that artificially shows the house is worth much less than its market value. The seller then sells the house for much less than it’s worth, and the buyer will turn around and sell the house for a huge profit. One of the biggest problems with this scam is many times the bank will hold the seller responsible for debts on the home that could have been resolved with a fair deal.
Finally, working with a Venice short sale agent can be very stressful, and there are con artists that look to profit from this vulnerability by calling themselves “short sale negotiators.” They charge sellers a flat fee based on the cost of the house, promising that they will provide results in the short sale process. The problem is that they collect their fee without doing much.
The best way to prevent becoming victim to these forms of fraud is to work closely with a reputable Venice short sale agent. Your agent will not only help you through the short sale process, but they can also protect you from all kinds of fraud as well.