Signs that a for-sale-by-owner transaction is a scam include requests for detailed personal information, interactions with a long-distance agency and terms that seem too good to be true. Additionally, scams often involve an insistence on using only cash or wire transfers, states Zillow.
Part of a for-sale-by-owner scam may involve an attempt to gain significant amounts of a victim's personal information. Buyers should take special caution regarding requests for sensitive information, such as bank account details, a Social Security Number and identifying personal documents, according to Zillow.
Scam artists often want to maintain a certain level of distance from their targets. As such, some claim to be from or actually are in far-flung and distant locations. As such, buyers should exercise caution when approached by independent sellers claiming to be in a far away location, Zillow warns.
A major sign of a scam is a seller's insistence on using cash or wire transfers to complete the deal, as Zillow reports, because transactions involving cash and wire transfers make the transaction more difficult to trace and protect the scam artist while leaving the buyer vulnerable. When possible, Zillow recommends that buyers use more secure and traceable transaction methods, such as checks. Asking buyers to pay upfront fees or to pay charges outside of escrow are additional signs of a scam, according to Nolo.