Report on Prevalent Real Estate Fraud Incidents by Rosreestr
Navigating Real Estate Transactions: Avoiding Scams and Verifying Sellers in Russia
When diving into the world of real estate purchases in Russia, beware of potential fraud schemes. Here's a lowdown on common scams and ways to dodge them.
Situations involving a vague property owner can be risky. When touring an apartment, the seller might show a sales contract and ask for a deposit to "reserve" the property. But remember, such contracts don't automatically prove ownership. To shield yourself, inquire about the seller's EGRN data and check it independently. If necessary, request an EGRN extract, which can be authenticated through the official Rosreestr website using a QR code.
Fraudsters may attempt to trick you by submitting a underreported sale price, promising it would help minimize taxes, then requesting the remaining balance in cash. However, if you end up in a lawsuit, the court might consider you dishonest for colluding with the seller, rendering the deal null and void. You'd only get the stated sale price back.
Another pitfall to watch out for is "unaccounted" tenants. If the apartment has been privatized but people who relinquished their right to a share have the legal right to live there for life, they can return through court order. To steer clear, always ask for an extract from the household book and gather information about the owner and past residents before purchasing. This data can be cross-checked starting September 1, 2025, using a real estate registry extract.
Criminals might also wield forged or rescinded powers of attorney. To ensure authenticity, verify the power of attorney online on the Federal Notary Chamber's website using the provided document details.
To put it all together, verifying a real estate seller's legitimacy in Russia revolves around due diligence and verification processes. Here's a roadmap:
Real Estate Seller Verification Steps:1. Title Search: Check registries to confirm ownership and identify any property encumbrances.2. Document Review: Ensure all documents, including deeds and contracts, are authentic.3. Identity Verification: Compare personal details with official documents and screen the seller against watchlists.4. Check for Insolvency: Verify that the seller isn't bankrupt or insolvent.5. Tax Compliance: Ensure property taxes are up-to-date with no missing payments.6. Property Inspection: Inspect the property for unauthorized alterations and its overall condition.7. Secure Communication: Use encrypted communication methods for sensitive data protection.8. Legal Agreement Review: Engage a legal expert to clarify terms and ensure compliance.
By staying vigilant and adhering to these steps, you can significantly minimize fraud risks in Russian real estate transactions.
Investing in Russian real estate requires careful attention to personal finance, particularly when dealing with financing and managing potential risks. For instance, beware of sellers providing underreported sale prices, promising tax benefits, but potentially misleading you about the true value of the property.
In personal-finance matters, it's essential to verify a real estate seller's legitimacy. This process includes checking for forged or rescinded powers of attorney, title search, document review, identity verification, checking for insolvency, ensuring tax compliance, property inspection, securing communication, and legal agreement review. By adhering to these steps, you can minimize fraud risks when investing in Russian real estate.
