Real Estate Scams & How to Avoid Them
According to a new FBI report, more than 11,000 victims were affected last year by internet real estate and rental crimes. Consumers are losing hundreds of millions of dollars every year due to scams, and that number is increasing.
Most stories we’ve heard involve wire fraud. In most cases, a real estate agent and/or their client’s email is compromised by a hacker which can give the scammer access to all of their communication. Scammers are patient and quietly follow the details of a transaction. Then at the time of closing, someone who, pretending to be an escrow officer or real estate agent will send a very detailed and specific email with wire instructions. Unfortunately these instructions send the money to the wrong account; thereby the buyer loses all their money, with little to no chance of ever recovering it.
Before transferring any money online, one should actually speak to an agent, escrow officer or other title agency professional to see if the request is truly coming from them. Wire instructions should never be sent via text message. And do not call a phone number given in a text or email, unless you are absolutely sure that number is legitimate. Verifying any request for money over the phone or in person with your agent, attorney, lender or Title Company is always worth the time.
Another popular scam is when a fraudster lists a house in a popular market for a low price or for rent. When the potential buyer calls, they are told that it’s unavailable for viewing right now and then asks for a deposit to hold the property. Scammers simply steal photos from real estate sites and create a bogus listing online. Then they collect bogus security deposits and down payments. They usually request that the money be sent via western union or some other non-traceable wire service.
The only way to avoid this type of scam is to always tour a property with your own buyer’s agent before making any deposit. This will help confirm property ownership and the agent will have access through their MLS system.
The safest and best way to buy and sell real estate is to hire your own licensed agent. Meet them in person, at their office. And use a local, full time expert. The internet is certainly a great thing that helps most of us on a daily basis. But, please do not allow the internet to handle one of the largest financial investments of your life. The internet has helped criminals increase fraudulent criminal activity because it is very easy to create false information, fake advertisements and bogus reviews.
Feel free to contact Rosie’s Team and we would be happy to give you more information!