Too Good To Be True? 4 Surefire Ways To Tell If Your Real Estate Deal’s A Fake

In this era of real estate investing, it’s rare to score a deal that no one else has looked at. Most of the time, if a deal sounds too good to be true, it probably is— but how do you tell? Here are a few surefire signs that your property investment deal is not as real as it seems.

A No-Show Representative

If the agent, representative, or property owner shies away from meeting you in person, take note. You should feel uneasy about the avoidance of a face-to-face meet-up. That’s not only odd but a little shady. As a prospective buyer, you should have absolutely zero doubt in your mind that you are dealing with the legal owner or the legal property rep.

To protect yourself from a scenario of facing an impersonator, go through a title company. This way, you will ensure that the person who you are dealing with is the title holder. For example, I once was faced with a situation where the son attempted to sell me a property, but the title was in his father’s name. The sad truth is that people faking that they are a legal owner happens more often than not. Be aware of this.

The Promise Of Guaranteed Returns

In a perfect world, guaranteed returns would be a thing of beauty, but if anyone makes claims that this will be your story with the investment property, be wary. In the real estate game (and life), there are no ‘100 percent’ guarantees. The nature of investment means that an investor must accept an immediate risk in the face of a possibility to make a long term profit. Therefore, if you hear of any one promising you zero investment risk, open your eyes to the major red flags that are waving.

Upfront Requests For Financial Info

This might sound obvious, so much so, that you are rolling your eyes at me right now, but you would be shocked at how much information individuals offer up. Requests for upfront financial info is one of the biggest and most active real estate scams out there. So many people fall prey to this! Picture this: a deal that sounds believable and great, but suddenly, you are asked to divulge personal financial info so a professional company can prove you are a legitimate buyer.

You are so excited about this property; your compulsion is to share anything that they want you to share. What you had for dinner. The name of your childhood cat. The street you lived on growing up. It seems like a real reason the company needs the financial information, but this trap is how many people get their identities stolen. Do you want to take the risk? Some things should always stay a secret to certain people.

Blind Eye To Important Information

Ever heard of the term ‘selling out?’ Well, in real estate investing, those two words have a different meaning than what you are normally used to hearing. ‘Selling out’ in real estate investing means that a property is being sold ASAP. The owner needs to get the property off of their hands before it becomes an even more detrimental liability. It’s like escaping from toxic waste. Still a little lost? Follow this scenario then: There is a fantastic deal on a property. You saw this opportunity on a website of a well-respected company. Everything looks solid— with nothing out of the ordinary. Rental income is high, and the property is located in a desirable neighborhood. What more could you ask for having?

Then there’s the catch. What someone failed to mention was that the city council has voted to build a landfill at the schoolyard a few houses away from your “gem.” If you hadn’t done your research or had a inspection done, you would have had no clue that the value of the property is bound to plummet based on structural issues. The property still looks good at the moment, and the current owners hope to get rid of it to a sucker. Be careful to not only trust, “how things look on paper” when making a big decision like investing in real estate.


Although what was mentioned was an example of an extreme case, the moral of the story remains: Always do your due diligence. Research, research, research! Also, pay attention to that “gut instinct.” It’s there for a reason. ‘Too good to be true,’ might just be ‘too good to be true’ for a reason.

Real estate is all about finding the best deals. No real big surprise there, but it’s often easier said than done. Just remember, deals exist, but it’s going to be tough in today’s market to score deals that no other person has even looked at before. Best of luck and be great!