Buying Real Estate Online: Some Precautions
Author: Jon Arcy
Source: articledashboard.com
You can buy almost everything else online, so why not real estate? There are now more than a few online auction sites where you can buy or sell real estate. Consumers who originally may have thought of Ebay as a place to sell random items from their garage can now browse extensive real estate listings.
One question that naturally occurs to many prospective buyers and sellers is, simply, is this a safe way to do business for such a high-cost item? It’s easy to picture a nightmare scenario where you buy a house or piece of land, sight unseen, from a photo posted online, and then it turns out that it wasn’t at all what you thought you were getting.
This brings up the subject of due diligence, which is a sensible course to follow in all business transactions, online or not. People have long been swindled in shady real estate deals, long before there was an internet. In some ways, a high tech environment makes it easier to take precautions.
One thing that not everyone knows is that bidding on an online real estate auction is not like signing a contract –it’s not legally binding in fact. There are many laws regarding real estate, and none of this can be covered by a mere click of your mouse. You can look at a bid for real estate, in fact, as little more than an initial show of interest, which may make it less intimidating.
Searching for real estate online can be extremely efficient; it can save you from making trips across the country. However, once you have located something that interests you, there is nothing to stop you from doing your own research. You could, for example, fall in love with a house ten states away and place a bid on it. In the meantime, while the auction is still running, you can take the time to do some fact-checking.
You may have to recruit the help of experts, such as attorneys, real estate agents or home inspectors to properly do your due diligence, but this is the same as with traditional real estate transactions. Responsible internet auctions such as Ebay, as well as the commonly used payment processors such as Paypal offer a certain degree of protection against fraud (check their user policies). With Ebay, you can also look up sellers’ feedback rating before bidding.
If you are going to consider buying real estate online, you must use at least as much caution as you would buying in person. Make sure to verify facts about any liens, titles, plumbing, taxes, zoning, well, sewer and so on. Also, do not ignore the surroundings; if you are not familiar with the town, city or county where the property is located, you can usually find out quite a bit online –facts about the economy, population, crime, climate and so forth.
Even if you feel as though you can trust the person you are dealing with, it’s not a good idea to rely completely on them for essential information. Facts about property are not hard to verify, either by hiring the relevant experts or by making some calls to local municipalities regarding legal matters.
Sellers in real estate auctions have slightly less to be concerned about, but they too must be careful. The financial qualifications of a buyer must be verified, or you may end up disappointed. Be sure to find out anything about your property you aren’t sure about (e.g. zoning laws, property lines) or you may unintentionally leave out or misrepresent something important.
If you aren’t sure how to describe your property, check with a local real estate office or advertising supplement and see how properties are listed. When describing your property, try to be as specific as possible. It’s better, for instance, to list the actual square footage of a room or house than to just say it’s large.
If you keep these precautions in mind, online real estate auctions can be very convenient tools. The key is not to oversimplify the process in your mind and think you can simply log-on, bid and buy without using any other resources.