We have moved.
But not too far.

As of May 25,2019 our new address is:

802 13th Avenue SW
Calgary, AB T2R 0L2
Nothing else will change.

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For 100 years, Ridout Barron has been dedicated to solving our clients' problems creatively and efficiently.

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Real estate: Why seller financing could be a scam

When property deals in Alberta involve seller financing, it might be a red flag. In real estate, seller financing opens up opportunities for sellers or agents to commit fraud. This option involves the seller offering the property for sale with the buyer making monthly payments. If the seller owns the property outright, it could be compared to a rent to own transaction, in which the buyer could ultimately own the property. Otherwise, the monthly payments would be used to pay the existing mortgage, but this in itself is fraud because the mortgage holder owns the property until it is fully paid, which means the property could not be sold.

However, it could be a seller’s scam in which the real estate is offered with seller financing to attract a buyer who might struggle to secure a mortgage. In this scenario, the property owner has a mortgage but fails to remit the buyer’s monthly payments into that account. The bank or lender has no interest in the buyer, and when the seller defaults on mortgage payments, the bank forecloses, and the buyer would have lost all payments made and any interest in the property.

If the scammer is an agent who acts on behalf of the seller, he or she might arrange the deal so that he or she collects the monthly payments from the buyer. Instead of then making monthly mortgage payments on behalf of the seller, the money is embezzled by the so-called agent. By the time the bank takes foreclosure action, both the seller and the buyer have become victims of the agent.

Retaining the services of an Alberta lawyer with experience in dealing with all types of real estate transactions would be the sensible thing for the seller and the buyer to do. It could avoid either of them being the victim of a real estate scam. Legal counsel will always protect the interests of the client. The lawyer will review the purchase contract to ensure it is legal and verify the property title to ensure it all agrees with what is offered.

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Ridout Barron
802 13th Ave SW
Calgary, AB T2R 0L2
Phone: 587-315-8454
Fax: 403-271-8016
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There is parking behind our building and/or free 2 hour street parking at our new location.

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