According to the Consumer Financial Protection Bureau, real estate wire fraud has increased dramatically and cost consumers an estimated $1 billion between 2015 and 2017 alone. Real estate wire fraud and mortgage closing scams can affect anyone. Scammers have become incredibly sophisticated. Some home buyers have lost their entire down payment as a result of these scams. Are you in the process of buying a home? Understanding how real estate wire fraud and closing scams work can help you take steps to protect yourself from these scams. Legal Counsel, PA is a real estate law firm in Orlando, Florida that can help you understand each step of the closing process, so that you can better protect yourself from these types of scams.

How Real Estate Wire Fraud Scams Work

Closing on a real estate transaction can be an incredibly stressful process. A real estate wire fraud scammer takes advantage of this stressful time and of the fact that many first-time home buyers are not always familiar with the real estate transaction process. Mortgage wire fraud and closing wire fraud occurs when a hacker poses as a real estate agent, real estate lawyer, or other trusted individual in a real estate transaction, using email or a phone call to get the home buyer to send closing funds to a fraudulent account.

Scammers and hackers may monitor emails of real estate agents, real estate lawyers, or other individuals trusted in a real estate transaction looking for upcoming real estate deals, and they might get your email address if they hack into real estate agent or escrow systems. These scammers may then “spoof” the email of the real estate agent, lawyer, or another trusted party in the real estate transaction, claiming fraudulently to be these individuals. Often the spoofed email looks very similar to the email of the trusted person. The spoofed email address may only have one letter changed or a number added. If the consumer isn’t cross referencing every email to make sure it is coming from a trusted address, the consumer can be tricked into following the instructions provided in the spoofed email. The fraudulent email often contains the wrong information about where the home buyer is to send closing money. The email might tell the home buyer that there’s been a last minute change in closing procedures or that the information for transferring money was incorrect in earlier correspondence. The home buyer that falls for the scam ends up wiring the closing money to the wrong account and the money is lost. It can be difficult to get money back when a wire transfer goes wrong in this manner. If you have fallen for such a scam, it is important to contact your bank immediately and to contact law enforcement authorities.

Legal Counsel, PA is a real estate law firm in Orlando, Florida that works with clients who are in the process of closing on a home. Our real estate lawyer can walk you through each step of the closing process. We can also oversee the closing process to help protect your rights.

How to Protect Yourself From Real Estate Wire Fraud in Orlando, Florida

Here are some things to keep in mind if you are buying a home to protect yourself from real estate wire fraud and closing scams:

  • Understand the closing process and discuss how closing will be handled in person with your real estate agent and with any other professionals working on your closing.
  • Have the contact information of trusted professionals written down and kept in a safe place. When responding to emails or phone calls from these professionals, always double check email addresses and phone numbers. Or better yet, confirm any information provided over the phone or email, in person.
  • Be wary of any last-minute changes to the closing process or any person contacting you to send money quickly.
  • Any wiring instructions should always be double checked in person or by phone. Never follow wiring instructions provided to you over an email without confirming the information with your trusted real estate professionals.
  • If you receive a phone call from your real estate agent or other trusted professional, be aware that scammers might use this method to get you to send information or money. Before sending money or providing bank information, double check phone numbers (phone numbers are easily spoofed), or hang up and call back your trusted professional using contact information you have written down and kept in a safe place.
  • Implement security measures when discussing crucial information about your real estate transactions. For example, it may not be wise to discuss any closing information over email.

The best way to protect yourself from this kind of scam is to be educated. Legal Counsel, PA is a real estate law firm in Orlando, Florida that can help you understand the steps involved in the closing process so that you can protect yourself and your money. Families have lost tens of thousands of dollars and even hundreds of thousands of dollars due to this scam. Understanding the closing process and working with trusted real estate professionals, like real estate agents and real estate lawyers who can educate you about the risks of this scam is important. Have questions?  We have answers.  Contact Legal Counsel, P.A. today at 407-982-4321.

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