Is Homevestors a Scam?

HomeVestors of America, headquartered in Dallas, TX, is a legitimate real estate investment company that operates through local franchises. Each franchise is independently owned, with HomeVestors supplying training and advertising in exchange for the franchise fee.

HomeVestors is a rapid reseller, meaning that franchisees purchase homes in need of quick sale and sell the property for more than the purchase price. The company advertising focuses on "ugly houses," homes in need of repair that might not get an optimal price with conventional real estate agents. Even in a poor real estate market, HomeVestors continued to expand, notes the Dallas Morning News.

Rapid resale and home flipping have a tarnished reputation because of now-illegal practices during the real estate bubble. According to the Federal Register, these practices involve selling property for an "artificially inflated value," aided by unethical lenders and appraisers. As with any purchase or sale, fraud is illegal, but rapid resale in itself is not.