(As reported by News Channel 3, Kalamazoo, MI)
John Pace was just two days away from closing on his new home when he received an email.
It was from his realtor and included several attachments, including his closing statement with all the costs listed. The email included wiring instructions and instructed Mr. Pace to wire $48,000 into an escrow account. It appeared quite legitimate; and since he normally communicated with his realtor via email, he had no reason to question it. He wired the funds as instructed.
When he informed his realtor he had wired the money, his realtor responded with the scariest words he’d ever heard: “What wire?”
Fortunately someone at the other end of the wire in Laredo, Texas was suspicious and stopped the wire from going through.
Scammers are emailing home buyers before the closing and masking the emails to appear as if they’re coming from their real estate agent. The emails instruct the home buyer to wire the closing funds into an escrow account. Mortgage originators are also receiving emails instructing them to provide revised wiring instructions to the title company at closing. Of course, these “revised” wire instructions turn out to be fraudulent.
What’s scary is that these emails appear to be legitimate, containing detailed information about the loan closing, including the borrower’s name, loan number, and the correct title company! These scams have been reported so far in at least Michigan and Florida.
Home Buyers Beware:
In downstate New York, attorneys typically direct the real estate transaction. This makes the scam a bit more difficult. Home buyers should note, for most closings in downstate New York, your attorney will instruct you to bring certified funds (in the form of bank checks) to your closing. However, if by chance it’s necessary for a home buyer to wire funds before the closing, the only person that should be instructing you to wire funds is YOUR ATTORNEY.
Warren Goldberg is President of Mortgage Wealth Advisors, a Certified Mortgage Planning Specialist®, and a published author. His interviews include Blog-Talk Radio, Newsday, and the Long Island Herald. Since 1992, he’s been sharing his financial knowledge and wealth-building strategies, including how to properly use your mortgage as a financial tool. His clients regularly express their trust and appreciation by recommending friends and family call when in need of mortgage, real estate, and financial guidance.