5 Real Estate Scams to Watch Out For

Whether you’re buying, selling, or refinancing a property for the first time or fifth, you’re going to be balancing lots of information, paperwork, communications, and transactions. It can be easy to get overwhelmed, and unfortunately, there are individuals out there who may try to take advantage of you during real estate transactions. Below are five common real estate scams you should be aware of in order to avoid being swindled.

Wire Fraud

Arguably the most common real estate scam is wire fraud, particularly in relation to escrow. These scams generally take the form of some kind of communication, be it by phone or email (these days, it’s most commonly email), from an individual claiming to be a representative of your escrow or title company. They will give you instructions for how and where to wire the money. Wire scammers are becoming increasingly sophisticated in their tactics; they often use fake websites and email addresses meant to mirror that of the company you are working with to make them seem legitimate. It is essential that you do not open any links you aren’t sure about and that you check with your Loan Officer to confirm any instructions you’ve received are accurate. Refer to contact information you previously received from your lender, title company, and closing agent rather than trusting what was included in the phone call or email.

Foreclosure Relief

Foreclosures are public record, and deceitful individuals may specifically target people who are in danger of losing their homes. These scammers will generally offer to stop the foreclosure process or greatly reduce mortgage payments in exchange for a large upfront payment. Once the money is received, they disappear, leaving the person who paid them in an even worse state than before; now, not only are they still facing foreclosure, but they’re out even more money. If you are facing foreclosure, you should contact your loan servicer to discuss your options. Make sure the people you seek guidance from are professionals you know you can trust; do not take the word of someone who cold calls or emails you out of the blue claiming to want to help.

Loan Flipping

Loan flipping occurs when someone (often purporting to be a lender) convinces a borrower to repeatedly refinance their mortgage, tacking on exuberant points and fees to each transaction—which usually involve borrowing even more money than the last—to the point where the borrower’s equity is greatly limited and they’re unable to keep up with loan payments. You should only refinance your home when you have done your research on the pros and cons and, with the help of a trusted mortgage professional, concluded that it is in your best interest to do so. A good lender or Loan Officer will not pressure you to do anything you are unsure about. If the person you are working with is being particularly pushy in trying to persuade you to refinance (especially if they have already done so in the past), it may be time to consider seeking another opinion.

Predatory Lending

Predatory lending can take numerous forms, but some key things to look out for are exceptionally high rates, excessive (and often hidden) fees and penalties, loan flipping, a lack of a credit check, loan packing (tacking on unnecessary additional financial products to your loan), and balloon payments (payments and fees that are delayed until later in the life of your loan).

These lenders often target at-risk borrowers such as those with low credit scores, a lack of cash, low income, and the elderly. It can sometimes be hard to tell what is and isn’t normal coming from a lender, especially when you are a first time buyer. A good way to ensure you are working with a trusted, legitimate lender is to seek out recommendations from friends and family who have been through the mortgage process before and look at online reviews. Check your lender and loan officer’s credentials to confirm they are properly licensed.

Moving Company Scams

When it’s time to move, you may seek the help of professional movers. Be wary of companies that quote prices far lower than competitors, especially if they offer a non-written estimate without seeing your home and belongings. Predatory movers may suddenly charge much more than what you were initially quoted and even demand additional money before releasing your personal property. Much like with lenders, you should do your due diligence in evaluating the merit of moving companies before hiring them in order to avoid losing your money and even your possessions.

What to Do About Scams?

If you believe you have identified or fallen victim to a scam, you can and should report it in order to hold the fraudsters accountable and hopefully prevent others from being scammed. The FTC has an online fraud report tool and the Better Business Bureau offers their “Scam Tracker” where you can not only report scams but also do research to ensure the individual or company you are working with is not fraudulent.

A great way to minimize your risk of being scammed is to work with legitimate professionals right from the outset of the mortgage process. If you are considering buying, selling, or refinancing your home, contact one of our experienced and trustworthy Loan Officers today!

5 Tips for a Greener Home Life

Celebrating and preserving the Earth starts right in your own home! In honor of Earth Day, First Home Mortgage is sharing some of our favorite habitat-healthy habits.  

Install a Rain Barrel 

Rain barrels are an easy and inexpensive way to store natural rainwater, which can be used to water your garden, lawn, and even indoor plants. Be sure the drain spout you are collecting from is clean and free of debris, and always keep the screen on top of your barrel tightly in place, to prevent any insects from breeding inside. A variety of different rain barrels can be purchased, or you can make your own! HGTV offers step-by-step instructions for an attractive DIY rain barrel here: https://www.hgtv.com/outdoors/gardens/planting-and-maintenance/how-to-make-a-rain-barrel-pictures 

Create a Compost Pile 

Composting leftover scraps reduces landfill waste and helps your garden thrive! Beginning to compost requires very few supplies. A pail for collecting your compostable waste indoors, and a composting bin, pile or tumbler for outdoors is all you need. For smaller yards, a composting tumbler is the best option because it prevents odor and insects. Some everyday items to compost include: produce trimmings (such as potato peels), coffee grounds, tea bags, grass clippings, dead leaves, and other garden waste. In time, these once worthless scraps will become nutrient rich soil to bring out the best in your lawn and garden! Find a complete guide to composting for beginners here:  https://pela.earth/blogs/news/composting-for-beginners 

Grow Your Own Herbs (and Even Veggies!) 

Herbs are small enough to thrive in any sunny window and can be grown indoors year-round. Growing your food at home is the most environmentally friendly option, provides your kitchen with the freshest possible herbs, and improves the air quality in your home. If you have outdoor space for a traditional or container garden, you can take it one step further and grow your own vegetables as well. Fully composted soil can be a major benefit to your outdoor gardens, but be sure not to use it indoors (as it will be home to many tiny organisms). While some plants are best left to seasoned gardeners, a host of vegetables are easy and low maintenance enough for beginners to grow. Not sure where to start? Find 9 Easy Vegetables to Grow for Beginners, here: https://www.lifescarousel.com/easy-vegetables-to-grow/ 

Reduce Paper Waste 

Limiting paper waste in your home is a wonderful way to reduce your environmental impact. Utilizing cloth dishtowels over paper towels and cloth napkins over paper napkins, are two easy and affordable ways to make a big difference over time. Requesting paperless billing and electronic receipts is another excellent measure to cut down on all that paper. When disposing of paper waste you can’t avoid, always opt to recycle when possible. Find a quick list of recyclable paper products and more information from the American Forest and Paper Association, here: https://www.afandpa.org/priorities/recycling/whats-recyclable 

Clean Greener 

Natural cleaning products are healthier for the environment and your home. Lemons, white vinegar, baking soda, and borax all work together in different ways to achieve the shine and fresh scent you crave. Store-bought air fresheners that are not all-natural can damage air quality, so it’s best to avoid them. Boiling cinnamon sticks is a great alternative to add some sweet scent to your space, and simmering vinegar mixed with water while cooking fish or other strongly scented foods can help absorb any unwanted odors. If you lack the time or inclination to whip up your own natural cleaners, more and more varieties are now available for purchase in stores and online. Find some quick all-natural cleaning recipes and tips here: https://kingcountygreen.com/2022/04/08/eco-friendly-tips-and-tricks-for-spring-cleaning/

First Home Mortgage takes our own steps to limit our environmental impact. Our offices utilize paperless technology and recycling, our Corporate location boasts water saving appliances and fixtures, and many employees across the company now work remote, decreasing gas consumption and transit pollution!  

If you or someone you know is looking to purchase or refinance a home, please reach out to one of our experienced and helpful Loan Officers today!

Pros and Cons of Moving to a Neighborhood with an HOA

Homeowners’ associations, or HOAs, are organizations consisting of a governing board of resident volunteers who create and enforce rules for a subdivision or planned unit development. If you buy a property within a community with an HOA, you are required to be a member which will happen automatically upon your purchasing the home. There are many varying opinions out there on HOAs, so it’s important you consider whether being part of one is right for you or not.




Shared Grounds are Maintained

Any common areas in your neighborhood, such as playgrounds and pools, are managed by the HOA. This allows you to enjoy the benefits of these shared community offerings without having to worry about any upkeep yourself. Sometimes, the HOA will even landscape the front yards of any properties, so your lawn may be taken care of—and paid for—by the HOA.


The Neighborhood Looks Nice

Because HOAs have rules for what you can and cannot change about your property, you don’t have to worry about any neighbors’ properties becoming eyesores. Not only does this make the neighborhood look more pleasant for residents, but it can even lead to higher home values. A 2019 study found that homes that are part of an HOA had prices that were, on average, 4% higher than similar homes not in an HOA.


Conflict Mediation and Resolution

If you run into any issues with neighbors, the HOA can help address the situation. If your neighbor has been playing loud music all hours of the night, has an outside dog that barks constantly, or is otherwise breaching HOA rules or acting in a problematic fashion, you can go to the HOA with your concerns and they can act as a go-between to avoid direct confrontation. This is especially helpful if you have addressed the issue directly with your neighbor and no change has been made.





HOA dues are a mandatory part of belonging to an HOA, and they may be expensive. They are sometimes collected monthly and other times annually. How high the dues largely depends on your location and the amenities offered by the HOA. Since HOA membership is compulsory when your property is within one’s jurisdiction, there is no way to get out of paying the fees. You should find out how much dues are and determine if keeping up with them will be manageable in addition to your mortgage, utilities, and other expenses.


Strict Guidelines

When you are part of an HOA, you agreeing to follow all rules and regulations. Some people feel that when you own a home, you should be able to do whatever you want to it, and with HOAs, that is not the case. HOAs may set guidelines for all sorts of things, from the color of house paint you use to and what you are allowed to have visible on your lawn, how tall your grass can grow and how many pets you can have. You should investigate the various guidelines set by the HOA and decide if you find them reasonable before committing to buy a property there.


Risk of Foreclosure

In some states, defaulting on HOA fees could lead to your home being foreclosed upon. For example, in California, if dues have not been paid in more than 12 months or the amount owed is greater than or equal to $1,800, your HOA can begin foreclosure proceedings. In other states, HOAs are at liberty to start the foreclosure process regardless of how long dues have gone unpaid or what the outstanding amount is. If you are at all concerned about your ability to keep up with HOA dues in addition to your other expenses, it is likely in your best interest not to move somewhere with an HOA to minimize your chances of foreclosure. At the very least, you should find out what laws are in place in the state you’re looking to buy in regarding HOA foreclosures so you are aware of your rights and when you may be at risk.


If you are considering making a move, contact one of our experienced Loan Officers today to learn more about your mortgage options!

Connect With Us