Mortgage scam prompts warnings

Latest mortgage scam prompts warnings from real estate board

By MYKE THOMAS, SUNMEDIA-Calgary Sun

The uncovering of the latest mortgage scam and that mortgage fraudsters are active in Calgary is not a surprise, says Diane Scott, president of the Calgary Real Estate Board.

“I started in (the real estate business) 1983 and this is the second or third round of this,” says Scott, who urges all buyers to do their due diligence to avoid being sucked into a scam.

“We have to watch for red flags such as a numbered company on the contract or high-ratio mortgages.”

CREB offers to the following tips to protect yourself against mortgage fraud:

– Employ a licensed mortgage broker registered under the Real Estate Act in Alberta.

Licensed mortgage brokers are required to conform to a code of conduct enforced by RECA. Contact RECA at 403-228-2954 to ensure your broker is licensed.

– Before you buy, have a realtor show you the listing history on the property.

Check the number of sales, price ranges and community prices.

– Use a realtor or other independent representation for your purchase.

If the seller objects, something is wrong.

– Get a comparative market analysis of the property.

Additionally, you may want to include, as part of your offer to purchase, the option to have the property appraised by a designated or accredited member of the Appraisal Institute of Canada.

– Ask for a copy of the land title search.

– Make sure your deposit is being held in a trust account.

For more information go to RECA’s website at http://www.reca.ca/consumers/ and search for ‘mortgage fraud red flags.’