Buying and selling real estate is a tricky business, particularly in the absence of a professional mediator. Property owners need to screen potential buyers and vice versa. However, Consumers involved in various real estate transactions may avoid this step, and risk their safety, to try and save some money. Due to lack of professional knowledge and experience, these DIY attempts can fail, risking huge sums of money in the process. Real Estate Fraud is on the rise because it involves hefty transactions, and digital manipulation makes it easy. Whether through online transactions, outright identity theft, or rental scams, let’s take a look at 3 types of real estate fraud we might commonly see:
Electronic communication between the property owner and client makes them an optimal target for real estate fraud. Both parties share a good deal of personal information with each other through emails, and the third party (the Hacker) can gain access to all of it. You must be familiar with strange emails where the sender is asking you for account details, or demanding an upfront payment for receiving a transaction. While some spam emails are quite obvious, others are cleverly crafted to deceive you. The imposter hacks the realtor’s account and sends the Purchaser an email to wire a specific amount of cash into the closing attorney or closing company’s account. In reality, this is the Hacker’s account. This person has done their research, so the email will sound very genuine.
Some hackers create a spoof account, which is almost identical to the real one. One extra letter or the omission of a single letter, may go unnoticed. The best way to confirm if the received email is legitimate, is to engage whomever is closing the transaction on a voice call. Do not use the contact number provided in that email, but the one printed on their business card or online business listing. If their number is saved in your phone and you two keep in touch, that’s even better.
Identity Theft Real Estate Fraud
Real Estate transactions give away a lot of personal and financial information, which can be used to commit various White Collar Crimes. Following a breach of data, the hacker will lay low for a while and monitor all your activities. The person having access to your social security number can wipe your accounts and even acquire loans in your name. The Hacker becomes YOU, and can create a huge mess. You may not even discover the fraud until you receive receipts for purchases you never made, or unpaid bills for services to which you never subscribed. Frequently changing passwords, setting up credit alerts, and using two-step verification (with one-time codes) for all your accounts can help strengthen your firewall against this type of fraud.
Fake brokers on the real estate market have fooled millions of people. They will gather information on listed apartments in a specific area, and then advertise them with their own contact information. They will make promising offers to interested renters, and then ask for a security deposit to finalize the deal. These swindlers will make up intriguing details regarding a place that may or may not even exist. If you say that you need time to think it over, or want to visit the location first, they will boast of other bidders, and say that they are too busy to show it to you. Some people fall for the lies, and transfer a month’s rent or more, without actually seeing the apartment or signing a lease, although scammers have used online signing tools to sign fake paperwork.
Criminals have become very savvy with these 3 types of real estate fraud, with new methods being tried each day. Always buy and sell property through a trusted and certified real estate agent to evade such scams. They have the knowledge and expertise to protect consumers from expensive mistakes.