Use Caution When Closing on Your New Home
It’s Realtor Safety Month. Real estate agents and their clients are targeted by violent criminals and cyber thieves. Statistically, tens of thousands of real estate agents are subjected to violence annually. Wire fraud, where a homebuyer’s email or real estate agent’s email is hacked, lose millions in various mortgage fraud closing scams. Studies show on average, Americans buy 3 to 5 homes in their lifetime. Chances are, you’re going to be engaged in some form of a real estate transaction in the next 5-10 years. There are a few things to know.
Think about this for a minute: You have been working hard and stocking money away, and you have finally found your dream home. The loan goes through, you wire the money to the bank or title company, and you think all is well. You go to sign the final paperwork and your heart falls out of your chest…they tell you that they never received the money, but you sent it. What happened? You were the victim of a real estate scam.
Real estate scams are more common than you probably think, and they often involve phishing. The scammers can take over the email address of the Realtor, the buyer, the title company, etc, and it is happening much more than ever before. In fact, it’s so common that buyers are losing millions of dollars each year.
When a hacker takes control of the email address of a real estate agent or a title company, they can then send very official-looking emails to people asking them to wire money for their new home to a specific bank account. However, what these buyers don’t realize is that the money goes to a different bank account…one that belongs to the hacker. By the time the scam is discovered, the money is long gone.
Sadly, this scam is getting more and more common, and it has happened to thousands of people trying to buy homes. One of the issues is that the real estate industry, as a whole, doesn’t really pay as much attention to security as it should. Though there are things like encryption, the real estate industry, including real estate agents, use a lot of free accounts and unprotected methods of communication. On top of this, Realtors and title agents are always on the move, so they use a lot of public Wi-Fi to access their accounts. This is essentially like inviting the hackers in.
Stopping Scams During Real Estate Closings
If you are looking to buy a house, you definitely should make sure that you are taking the right steps to prevent scams like these. Here are some things that you should do:
- Don’t use email as the only way to set up your financial transactions. Use the phone, make a call, and confirm all of the transactions that are occurring.
- You should have everything in writing, and then double-check all of this. Make sure you are using some type of system such as meeting the Realtor or title company in person or via video chat.
- If you get directions to wire money, contact the company first to make sure that it’s legitimate. Don’t email them and ask them to call, however. Why? Because you could simply be emailing the hacker.
- Also, make sure you confirm via phone with the title company, bank, and real estate agent about any money transfer.
- Verify all transfers as soon as you can. If you believe you have sent money to a scammer, immediately call the bank. They may be able to freeze the money.
- Ask the people you are working with about their email. Is it secure? How do they know? Do they use encryption and two-factor authentication? Are they using strong passwords?
- You can also ask if they have a “forwarding email” set in their settings. Even if they say no, make sure they check. Many people who are victims of this don’t even realize that their emails are being forwarded to hackers.
- Do they know if people are logging into their email from other locations?
- Ask them to enter their email address at the Protect Now FREE Email Checker to see if their email has been compromised in a data breach You can also check their email address right on the site. Then, if you find the email address in vulnerable, you can tell them, and they can take the appropriate steps.
Remember, you should never assume that anyone, including yourself, is totally secure during any type of real estate transaction. You should not take for granted that the Realtor has someone in their home, such as their child, who could be using the same computer for gaming, and it is filled with spyware.
Buying a home is typically the biggest financial transaction that people ever do, and if you fall victim to a scam like this, you can easily be ruined, financially. Be aware, cover your bases, and be annoying if you must; you should always insist on a secure transaction when buying a home.
Written by Robert Siciliano, CEO of Credit Parent, Head of Training & Security Awareness Expert at Protect Now, #1 Best Selling Amazon author, Media Personality & Architect of CSI Protection Certification.