What You Need to Know About Real Estate Wire Fraud

As business relies more and more on online communication, opportunities for scammers are growing—and real estate is no exception. Nowadays, you can complete almost the entire real estate process online or via email—you may never meet your lender, attorney, or even your real estate agent if you're buying long-distance!

Needless to say, this has completely changed the real estate experience, making it much more convenient and flexible, but it's also left some room for innovative scammers to take advantage of unwary investors. The most common type of real estate scam is called wire fraud, and it can be potentially devastating if you're not prepared.

The best way to prevent yourself from becoming another victim of real estate wire fraud is to be knowledgeable and take precautions. Knowing how scammers strike, and recognizing the signs of a scam, could save you thousands of dollars! Here's what you need to know about wire fraud... and how to prevent it.

Wait... What Is Real Estate Wire Fraud?

Simply put, real estate wire fraud occurs when a scammer poses, usually via email, as someone you trust—like your agent, lender, or attorney—and gives you instructions for wiring closing costs into a false bank account. Before you dismiss this as something you'd never fall for, understand that some of these scammers are very detailed and can create incredibly realistic accounts, copying logos, signatures, and email address. They might even CC another trusted member of your team to further authenticate the communication. Fortunately, there are ways to spot a fake, even if it's very good.

Ways to Spot Wire Fraud

Even if a fake is very authentic, there are usually signs that something is off. If you see one of these warning signs, don't reply to the email; instead, contact your agent, lender, or attorney by phone to clarify.

There's been a change.

If you receive an email from your lender noting a change in routing or account number, this should seem suspicious, as it's not likely something that would be changed.

The email is URGENT.

Scammers will often try to create a sense of panic, thus preventing you from stopping to think, by putting a sudden, and very close, deadline on your wire transfer.

A tiny detail is off.

The scammer likely won't be able to duplicate your lender's address exactly, so be sure to inspect email addresses closely—there might be just one little letter out of place.

Ways to Prevent Wire Fraud

The best way to prevent wire fraud is to be on the lookout for suspicious activity. When in doubt, call! Here are some ways to ensure you're protected against potential scammers.

  • Know the process. Discuss the closing process with your agent, lender, and attorney so you know what's expected of you, and when. Any changes to this process or timeline should alert you that something could be amiss.
  • Be wary of changes. If any changes are made to your discussed closing procedure, you'll definitely want to confirm this with all your representatives—preferably not via email!
  • Never email personal information. If anyone requests any type of personal information via email, this should ring false. Professionals should never request or require you to send confidential information over unsecured email.
  • Be wary of personal information sent to you. Most lenders and attorneys have secure systems for transferring personal information, and likely aren't going to email you their account numbers.
  • Call to confirm. Even if everything seems fine, it never hurts to double check! Before sending any money or scheduling any wire transfers, call up your lender or attorney to confirm all account numbers.

Buying or Selling in Port Liberte?

Are you thinking of buying or selling a home in Port Liberte? Let me help! Not only will I help you navigate the real estate process from start to finish, I'll also ensure your personal information is always safe and confidential so you don't find yourself the victim of a ruthless crime like wire fraud. Contact me today to learn more, to ask any questions, or to get started buying or selling!