5 Scams Targeting New Homeowners and How to Protect Yourself

Moving into a new home is an exciting milestone. However, with the joy of homeownership also comes the need to stay vigilant, as new homeowners often become targets for various scams. Understanding common scams and knowing how to protect yourself is essential to enjoying your new home worry-free. Here are five scams new homeowners often face and tips on how to avoid them.

1. Fake Utility Company Scams

Shortly after moving in, you may receive a call or email claiming to be from a utility company, asking for immediate payment to avoid service interruption. These scammers will often use scare tactics, stating that your electricity, water, or gas will be shut off unless you pay immediately.

How to Protect Yourself:
Legitimate utility companies will never ask for payment over the phone in this manner, especially not right after you’ve moved in. If you’re unsure, hang up and call the utility company directly using the number on their official website. Avoid giving out personal information or payment details unless you’ve verified the legitimacy of the caller.

2. Deed Fraud

This scam involves a fake company or individual who will claim you need to pay a fee to receive a copy of your property deed. Often, they’ll send a convincing letter that looks official, urging you to act fast. In reality, these documents are accessible through your county’s records office, usually for a much lower fee or even for free.

How to Protect Yourself:
Be aware that you don’t need to pay extra fees to obtain your deed. Contact your county recorder’s office or check their website if you need a copy of your deed. They will guide you through the process, and you’ll avoid unnecessary fees.

3. Home Warranty Scams

After closing on your home, you may receive calls or mailers offering home warranties. While home warranties can be beneficial, scammers will often pose as legitimate companies and offer “warranty coverage” that doesn’t exist. Once you’ve paid, they may disappear, leaving you without protection.

How to Protect Yourself:
If you’re interested in a home warranty, work directly with reputable companies recommended by your real estate agent or those you have thoroughly researched. Avoid paying for warranties from unsolicited offers, as these are often scams.

4. Property Tax Scams

Scammers may contact you, posing as government officials, and claim that you owe back taxes on your property. They will often threaten foreclosure or other legal actions if you don’t pay immediately. This can be especially unsettling for new homeowners unfamiliar with local property tax processes.

How to Protect Yourself:
Verify any property tax inquiries directly with your local tax assessor’s office. Government agencies typically send official notices by mail, and they don’t ask for payment over the phone or email. If you receive a suspicious call, don’t provide any personal information, and call your tax office to confirm your status.

5. Mortgage Protection Insurance Scams

After buying a home, you may be approached by companies selling mortgage protection insurance, often with high-pressure sales tactics. While this type of insurance can be legitimate, some scammers create fake policies and take your money without offering any real coverage.

How to Protect Yourself:
Research any insurance company thoroughly before signing up for any policies. You can check the legitimacy of the company through the Better Business Bureau or the state insurance commissioner’s office. Consider it a red flag if a company insists on immediate payment or refuses to provide detailed information.

Final Thoughts

Homeownership is an achievement to celebrate, but it’s important to stay informed and cautious to protect yourself from scammers. By understanding these common scams, you’ll be better prepared to spot red flags and safeguard your investment. Our team at LRG is here to support you every step of the way, from the home-buying process to ensuring a smooth transition into homeownership. Contact us with any questions, or reach out if you need trusted local resources. Contact us at 210-879-8220 or message us on our website. You can also follow us or message us on Instagram and Facebook! Also, check out our TikTok!