Most cash buyers operate honestly. But older owners, people in trouble, and people uneasy with English are often targeted. Here are 8 signs to stop and ask someone else before signing, even when the buyer is us.
The 8 signs
- They ask for any fee up front. Buyers do not charge sellers. California law prohibits upfront fees for loan negotiation services.
- They tell you to sign over your deed (grant deed, quitclaim) right away, outside escrow. A deed should only be transferred through an escrow company, at the same time you receive your money.
- They quote a price by phone only and will not provide a written offer.
- They push you to sign the same day and do not let you ask family or an attorney.
- They do not clearly explain contract assignment. Assigning a contract to another investor is legal, but the buyer must say so up front and put it in the contract.
- They tell you to stop paying your mortgage, or promise they can definitely "save" you from foreclosure.
- They propose a "subject-to" deal without explaining it: title moves to them but the loan stays in your name. If they stop paying, your credit suffers.
- They offer a very high price at first, then cut it sharply near closing when you have no way out.
Wire fraud: the most dangerous
Criminals spoof the escrow company's email and send "new wire instructions." Before sending or receiving any money, call escrow at a number you look up yourself (from the escrow company's official website or your original paperwork), not a number in an email. A real escrow company does not change wire instructions by email.
What to verify
- The name, phone number, and legal entity that will sign the contract
- Look up the entity on the California Secretary of State's bizfile site
- That the escrow company is real: call it yourself to confirm
- A written offer: price, closing date, who pays which fees, and cancellation terms
- Have a family member or trusted person listen in and read the documents with you
Our promise
No upfront fees. All money and documents through escrow. A written offer with the math shown. Clear disclosure of contract assignment. Time to think. About us →
This article is general information only, not legal or tax advice. Laws change; ask an attorney or CPA about your specific situation.