Almost two years ago, I published an article (New Scam Targets Realtors and Home Buyers) explaining hackers’ latest scam to defraud home buyers of their closing costs. The Federal Trade Commission and the National Association of Realtors are again warning home buyers, as this has become an issue once more.
Hackers have been breaking into the email accounts of real estate professionals and consumers to access information about home buyers’ closing dates. Once the hacker learns of the pending closing, the hacker sends a fraudulent email, posing as the realtor, lender, or title company, informing the home buyer of a “last minute change,” instructing the home buyer to wire the closing funds to a different account. 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! 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.
According to the FTC, buyers who fall prey to this scam could find their bank account cleaned out with little chance of their savings being recovered.
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. And these instructions should be verified in person or by phone.
Warren Goldberg is President of Mortgage Wealth Advisors, a Certified Mortgage Planning Specialist®, and a published author. His interviews include Blog-Talk Radio, Newsday, The Daily News, Anton Press, 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.