BiFeO3 nanoparticles were synthesized by a wet chemical method. X-ray powder diffraction indicated single phase samples. The sample S1 shows a ferromagnetic-like behavior whereas S2 exhibits an antiferromagnetic-like character with lower magnetic moment and coercive field. Magnetic measurements at high temperature reveal two phase transitions, one related to BiFeO3 and another from α-Fe2O3 magnetic impurity in contrast to X-ray diffraction. We observed an increase of remanent polarization, coercive electrical field, and the appearance of interfacial polarization due to higher leakage current density. We discuss how an apparently single phase sample can lead to misleading interpretations in magnetic and dielectric properties.