Seniors are being targeted in a new real estate scam that tries to get them to sign over their home for far below market value.
Mary Ann Welch, 70, shared with Capital Public Radio how she received a letter in her mailbox that offered to buy her Sunnyvale, Calif., home for $750,000. The letter included paperwork for her to sign and consent to sell. Welch had not put the house up for rent or for sale. The two-bedroom home is within walking distance of Apple, Google, and LinkedIn, and is valued at more than $1.5 million.
“I saw the contract for me to sign and I was furious,” Welch told Capital Public Radio. “If I had Alzheimer’s or if I was demented at all, I would have signed it thinking I would get all this money. … If they’re doing it to me, they’re going to be doing it to others.”
Cherie Bourlard, Santa Clara County’s deputy district attorney, says they’ve seen an uptick in cases that involve direct solicitations to elderly homeowners that contain offers well below market value for their home.
Housing markets where prices have risen quickly may be most prime for the scam. Homeowners may “have no idea of the value of the homes they’re sitting on,” Bourlard says. “They remember buying their home for $40,000 but in these crazy upswings of market value, they have no idea their property might be worth $800,000, $1 million, $2 million.”
The scams targeting the elderly may not be voidable either for those who sign. “They might not clearly understand what they’re doing,” Bourlard says. “But they have enough [mental] capacity to where the transaction is not voidable. Studies show as we age, we become less savvy in financial transactions.”
Duane Shewaga, Santa Clara County real estate fraud coordinator, says that scammers are trolling public property records looking for elderly homeowners who have very low assessed values.
Some scammers will even go door to door, warns San Diego County prosecutor Valerie Tanney. “I’ve had numerous cases where they approach and befriend people and use religion and the trusting nature of people at churches to victimize,” Tanney told Capital Public Radio.
Tanney urges seniors who receive such solicitations to report any real estate fraud to the police and district attorneys’ offices. Also, seniors should not sign any paperwork without first consulting a real estate agent, lawyer, or financial planner.