Real-estate-scam-transactions.docx

REAL ESTATE SCAM TRANSACTIONS

1. PRE-SELLING SCAM

The developer will promise that it will be finished on a certain timeframe, but they will extend it time and again until the home buyer gives up on it.

2. DOUBLE SALE OF PROPERTY

Under this scam, the property in question is bought by two different people. This happens when the first buyer fails to register and transfer the title to their name, and then the crooked owner will sell it again. Thus, both buyers have the same title under their own names.

3. BAIT-AND-SWITCH SCHEME

These properties are either not really for sale or are handled by a different agent. The property is listed at an attractively low price to get people’s attention (the bait), but once a client inquires, the agent will claim that either the house has already been sold or is not available anymore. Agents will then offer their own listings that may even be pricier than their previous offer (the switch).

4. INSUFFICIENT DISCLOSURE

This scam happens when less-than-reputable real estate developers, real estate agents, or even home sellers intentionally withhold information about the property that may make potential clients think twice before buying.

5. REAL ESTATE AGENT POSERS

These fake agents are responsible for most real estate frauds in the country. Some would create legitimate-looking web sites and put up listings they’ve copied online. And once they’ve tricked you into paying a security deposit or initial payment, they’ll leave you high and dry. Because they use forged documents and contact information, running after them is more difficult.

6. PROPERTY TITLE FRAUD

This is done by syndicates or fake agents with their cohorts to convince you to buy seemingly affordable properties. These scammers would use old titles and copy the information to create a fake title. They would also add supporting documents to make it seem like all the papers are in order.

7. PIRATED LISTINGS

These are often found in online classified ads, which cannot be personally verified by site administrators. Or the agents sometimes pose as potential buyers and gather all pertinent information about the property. Once they have the details and have even taken photographs, they would claim that they are the homeowners’ representative. But after the buyer pays for fees and initial payment, the agents will suddenly be unavailable or will come up with excuses when contacted.

8. FAKE HOUSE RENTALS

There are two ways this scam is executed: using a house that is vacant because the owners are abroad or one that is really up for sale. The scammer will scout a

property which has been sitting empty for a period of time – either the owners are not based in the country or away on a trip. The property will then be offered to an unsuspecting client. They will either say they are the owners or are the authorized representatives of the owners.

9. FORECLOSURE SCAMS

Scammers take advantage of properties up for foreclosure by offering it to unsuspecting clients – particularly OFWs – who are not able to check the properties personally. The scammer would either pose as the real home owner or an agent. They will then forge official-looking documents to present to the potential buyer.

DUE DILIGENCE In order to protect your future home, you should always perform due diligence. Research is a very important part of the home buying process. You shouldn’t just rely on the real estate agent you’ve hired. Do know who you are dealing with and conduct a thorough background investigation. Find out how credible they are and if the property they are selling is really legitimate.

HOW TO AVOID FAKE TITLES

Here are a few things to keep in mind when you’re conducting your due diligence: 

Original Certificate of Title. The original title, which is stored in the Register of Deeds.



Owner’s Duplicate Copy. An exact or carbon copy of the Original Certificate of Title that’s given to the owner of the property.



Transfer Certificate of Title. When the title is to be transferred from the owner to the buyer, the original Owner’s Duplicate Copy should be the same as the Transfer Certificate of Title.



Judicial Forms. The government forms used in conducting the transaction with accompanying serial numbers. There are different kinds of judicial forms depending on the purpose.

Take note of these forms: o

No. 108-D Original Certificate of Title – Owner’s Duplicate

o

No. 109-D Transfer Certificate of Title – Owner’s Duplicate

o

LRC Form 1-A Condominium Certificate of Title – -Owner’s Duplicate

Easy Way: 1. Check the Paper Material One of the first things you can check to immediately spot a fake title is the physical appearance of the paper. The Bangko Sentral ng Pilipinas (BSP)is solely responsible for printing the judiciary forms used in the preparation of the property titles. They use a special paper composed of 50% cotton and 50% chemical wood pulp with artificially colored silk fibers. As such there are security features you need to look out for in its physical appearance to ensure its authenticity: 

NALTDRA or LRA watermark that can be seen when held against the light.



fibers of the paper material



planchettes or the colored circular patterns on the title



intaglio (technique used in printmaking) on border

According to LRA, fake titles are usually printed in forms made of cartolina or material of inferior quality.

2. Check the Copies First, check the initials, signatures, technical description, annotation and other component elements in the front and the back of the original copy are exactly the same as the duplicate copy. After all, they’re supposed to be carbon copies. If you see any difference, you better be suspicious.

3. Check the Serial Number The serial number of Judicial Forms for the original copy should be printed in red while the duplicate copy should be in black. The serial number of the title should

follow the serial numbers of the other titles from the particular Registries of Deeds from which your title came from.

4. Check the Dates Likewise, a number is assigned to the judicial form found on the upper left-hand corner of the form. Below the number is the year when the form was printed or revised. If the judicial form of your title was prepared before the date when the form was printed or revised, then you better start worrying.

5. Check the Title and Seal The

duplicate

copy

should

have

the

words

OWNER’S

DUPLICATE

CERTIFICATE on the left side margin of the judicial form. There should also be a red seal—which should not blot or stain when wet—affixed on the lower left corner of the form. The original copy does not contain either of these feature.

6. Check the Title Number Check the last two digits of the title number, which should match the page number of the registration book noted on the upper right corner of the title.

7. Check the Reconstituted Tags A lost or destroyed title needs to be reconstituted. A reconstituted original copy of the title should have the letters “RO” before the title number while a reconstituted transfer certificate of title should then have the letters “RT” before the title number.

Registry of Deeds or LRA Verification: 8. Check the Register of Deeds Check if the person who signed the title was really the Register of Deeds at the time when the title was issued.

9. Check the Entry Book Check if the entry of a related transaction in the Primary Entry Book to see if the title was issued on the basis of a duly registered document.

10. Check the Enumeration Book Check the Enumeration Book or logbook to see which personnel was assigned to prepare the title on a certain date and the serial number of the judicial form used.

11. Check the Releasing Book Check the Releasing Book to see if there was a title of such number that was released by the registry on that date.

12. Check the History Lastly, track the history of the title to see if the source is genuine. You might have to go back all the way to the mother title, the derivate titles and other relevant documents. Following the above steps is a good way to avoid being victimized by fake land titles to supposedly cheap real estate properties being sold by syndicates. Most of the time, the offered price is generally too low vis-à-vis the current fair market value.