How to Spot 'We Buy Houses' Scams (and Find the Real Buyers)

A real cash buyer can show you money: a bank statement, a brokerage letter, a line-of-credit confirmation. Ask for it before signing anything. A 'buyer' who deflects — 'our funding partner handles that,' 'it's ready when we need it' — is usually a wholesaler planning to sell your contract to someone who actually has money. Wholesaling isn't illegal, but a wholesaler who can't find an end buyer walks away at day 29, having burned the weeks you couldn't afford.

Read for these four clauses. Long inspection periods (21-30 days) on a 'cash' offer — cash buyers need days, not a month; long windows are shopping time for wholesalers. Broad assignment rights ('and/or assigns' with no restrictions) — your buyer intends to be replaced. Weasel-worded earnest money — tiny deposits ($100) or deposits refundable for any reason mean the buyer risks nothing by walking. Memorandum-of-contract recording rights — some operators record against your title so you can't sell to anyone else while they shop your deal. Any one of these deserves questions; two or more deserves a different buyer.

Never sign a deed outside a closing. Equity-skimming schemes ask distressed owners to 'temporarily' deed the house over — for help with the mortgage, to 'stop the foreclosure,' with a promise you can stay or buy it back. The deed transfers; the promises don't. Similarly, treat as radioactive: anyone who tells you not to talk to your lender, attorney, or family; anyone charging upfront fees for a sale or foreclosure 'rescue'; and anyone whose offer must be accepted 'today.' Legitimate offers survive a 48-hour think and a second opinion.

Search the entity name in your state's business registry (active? how old?). Search the county recorder for deeds actually recorded to them — real buyers leave a paper trail of closed purchases. Ask for two references from past sellers and actually call. Require proof of funds in writing. Confirm closing happens at a licensed title company or attorney's office, with your payoff handled through escrow. Anyone legitimate passes all five tests without friction; most predators fail three.

Fast Local Buyers exists partly because this verification burden shouldn't fall on someone already in crisis. Buyers in our network document proof of funds and a closing track record before receiving a single property, and buyers who retrade, stall, or fail to close are removed. Whoever you sell to — through us or not — hold them to the standards in this guide. The good ones expect it.