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Real Estate Fraud is a Major Threat in the Philippines

Posted On   date17/05/2019

Real Estate Fraud is a Major Threat in the Philippines

Buying a property is a big decision in anyone’s life or business, whether it is the first time or another investment. That is precisely why being careful and avoiding fraud is so important. Philippines private investigators warn that real estate fraud and investment scams in the Philippines is becoming a major threat for foreigners looking for property in this country.

Residential real estate properties are not the only ones suffering from this problem. According to a recent publication, there is a high demand for office space derived from the growth in the business services companies, as well as retail space and hospitality. International brands such as Hyatt and Hilton have invested in new developments in the Philippines, and many more are following. The problem is many people and company executives are not aware of how real estate fraud is growing or how to avoid being victim to a scam.  The Philippines offers opportunity, but serious risk also.

How does real estate fraud work?

There are endless possibilities which can begin online, in person, or through your business.  Online scammers in the Philippines are aware of the interest that foreigners show for certain locations and work hard on finding and targeting their potential victims. Sometimes those potential victims will be people who have manifested  an interest to buy a property via a website or an online real estate platform, sometimes they will be executives of companies who are known to be interested in expanding in the Philippines. In either case, prevention is key to keep your money safe.

Once the criminals have picked their target, they will try to contact them and pretend to be someone who can help with the goal of buying or renting the property. Usually, the most common cases involve the impersonation of the current owner of the property, an escrow officer, a representative from the title company or a real estate agent. One of the most frequent schemes is to put pressure into the interested party by stating it will be sold to someone else or the closing date will be pushed back. Considering most people and businesses have a deadline to get things done in the property, it feels urgent to comply with whatever the criminals request – without noticing the fraud scheme – as long as they don’t lose the possibility of getting the property. This sense of urgency is the dangerous part, since buyers skip the due diligence process.  Due diligence is critical to staying safe.

How to avoid real estate fraud?

Ask many questions. Request everything you need to know before renting or buying, before agreeing to a down payment or even before scheduling a travel to see the property you want to buy. In the case of long term or temporary rentals through online websites, some of these do not let owners or realtors post the exact address. Ask for it before going any further and make sure a local private investigator in the Philippines can visit the property and verify the documents to make sure it is real.

In case you are intending to purchase the property, request copies of the deed, the exact address, copy of an ID of the owner, and just as much information as you can. The next step would be to request your investigator in the Philippines to verify all the information at the proper authorities. Having a professional third party conduct a local investigation will avoid possible forged documents.

Contact us for an investigation quote if you are planning to invest in the Philippines.

C. Wright
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