Real estate scams to watch out for

Wholesaler equity theft

This one is very sneaky and can cost you a lot of money. Wholesalers are just a middle man between someone wanting to sell their home and someone wanting to buy the home (typically an investor). Wholesalers present themselves as cash buyers, ready to close fast and buy as-is. Once you sign a contract with a wholesaler, they need to have a “partner” come look at the home. That partner is actually another buyer to whom the wholesaler is trying to sell your home to at a marked up price. So if a wholesaler is buying your home for $100k and they find an investor to pay $120k, they keep that $20k.

What’s the problem with this? If you get the price you want for your home, does it really matter? Well that’s up to you. The issue with wholesalers are:

1. They don’t tell you they are wholesaling – The act like they are buying your home without disclosing they might not financially be able to or have 0 intention of actually closing. Would you be ok if you found out on the day of closing that your buyer (a wholesaler) wasn’t going to buy your home?
2. Renegotiations – wholesalers are notorious for locking sellers into a contract, then using excuses such as “our contractor said the repairs are higher than we thought” to get you to reduce the price by thousands of dollars. Sometimes they wait until the last minute the day before closing to pull this trick.
3. The contracts are one-sided – usually you are stuck with them once you sign. So if they close, you are forced to sell. If they don’t close, you have no recourse and will waste a lot of time. Often times you see only $10 earnest money.
4. It’s illegal – as of November 2025, the state of Oklahoma implemented new laws governing wholesalers. That’s how big this scam is. Specifically, if they don’t follow clear rules in their paperwork and process, they can be breaking the law. Even some title companies have started to not accept contracts from wholesalers that aren’t following the new laws.
5. Last minute closing cancellations – we see this one a lot. Sometimes wholesalers can’t find a buyer and wait until the day of closing to tell you they can’t buy your home. Imagine packing up, finding a new home, only to find out the day of closing you can’t sell your house. The worst of this is when wholesalers do it intentionally knowing that you’ll lower the price if they try to delay closing.
6. Loss of equity – most often, homeowners don’t understand what their house is really worth in these cases and the wholesaler is not going to provide this information. They hope you don’t know. What might look like a good deal for the seller turns out to be a bad decision when you look at the facts.

How can you identify wholesalers? If you notice any of the following, just walk away no matter what the offer is:

1. “and/or assigns” or “contract is assignable” – if you see this words on the contract, it’s a wholesaler.
2. Power of attorney – if they are making you sign a power of attorney, it’s a wholesaler.
3. Needs partner approval or walkthrough – partner is code for “another buyer I’m trying to get to pay more than me”, it’s a wholesaler.
4. Little to no earnest money – If you don’t see at least $1,000 in earnest money, it’s a wholesaler.
5. Needs to put a lockbox on the home before closing – there is no reason to go back to the house before closing, it’s a wholesaler.

The simple way to avoid this scam is just call Unicorn Real Estate when you want to sell your home. If there is a reason you are leaning towards an off-market, cash sale, we can help. Whether that is making you a fair market as-is offer OR helping you sell your house off-market to legitimate investors and netting you more money….call us before you sign anything.