Buying an unseen home could lead to mortgage fraud

It may seem unusual to purchase a house that you haven’t seen, but it does happen from time to time. The two most common reasons for buying a house sight unseen are a job transfer that requires an immediate move with no time to house shop, or a real estate investment in property that is in another city or state. While it clearly is not in anyone’s best interests to purchase a house this way, sometimes it is simply unavoidable. The thing to watch out for is to make sure that you receive what you agreed to buy, and that you know what it is that you agreed to buy.

Sometimes, a new job in another state pops up and you just can’t take the time to house shop properly. What do you do? You can’t just randomly grab something; you have to have something to go on. Here are some great tips for buying a house sight unseen:

• Shop on the Internet. There are many real estate companies that provide online “virtual tours” that will let you get a pretty good idea of what a house looks like.
• Hire a realtor or agent to shop for you. Give them a list of things that are important to you so that they have some idea of what it is you are seeking.
• Hire someone who is not interested in selling a house to you. You want someone who is working for you, not someone who is working for a homeowner who needs to sell. 

• Make sure you request detailed information about local schools, zoning, crime statistics, property taxes, and the like. You will want a good idea of what it is like to live in that neighborhood before you buy.
• You may wish to hire an attorney in your new location, as well. While an attorney is always a good idea when you engage in any real estate transaction, it would be especially beneficial to have one when you cannot see the property before you buy.
• Make sure that you arrange for a detailed property inspection. This should include structure, foundation, electrical, plumbing, roofing and any additional areas that might need inspection. The last thing you want to do is buy a house with termites or a cracked foundation.
• Reserve the right to inspect the house in person before you close on the deal. 

While it is fairly rare for someone to move into a house that they have not seen, it is quite common for investors to purchase a house that way. Unfortunately, such investors can often be unwittingly involved in mortgage fraud scams. Often, unscrupulous lending agents, working in concert with appraisers, will buy property, offer it to an out of state buyer along with a phony appraisal, and sell the property to the investor at a huge markup. This is known as “flipping” and it is one of the most popular types of mortgage fraud in use today. Anyone who is considering buying out of state property is strongly encouraged to hire the services of someone you trust to inspect the property in order to makes sure that what you are buying is worth the amount you agree to pay.