Scammers posing as homeowners, selling property and pocketing the money
Nationwide problem. U.S Secret Service issues warning
PHOENIX (3TV/CBS 5) - It’s a scam that impacts prospective home buyers, real estate attorneys, and title companies. “I hate to say this but it’s relatively simple to do. And that’s what concerns all of us,” Thomas Cronkright said. He’s with CertifID, a wire fraud recovery and prevention company.
Con artists are posing as property owners or sellers and getting away with thousands or sometimes millions of dollars. After seeing increased real estate scam reports, the U.S. Secret Service recently issued a security advisory. Cronkright says he’s seen firsthand the devastating impact of this con. “We’ve had some people that’ve faced homelessness after this, because they’ve already sold their house.”
Cronkright says the scam works like this. The fraudster looks up the ownership records of a vacant property online, impersonates the owner, then hires a real estate agent to list the property for sale. The scammer will then push for a cash sale under market value, hoping to close quickly and make off with all of the buyer’s funds. Cronkright says this scam is happening all across the country, particularly with commercially zoned properties where vacant land might be worth more than a residential lot. He says it’s an easy target for fraudsters because owners may not think about their property until they’re ready to build or improve it.
Jonathan Biggs, Vice President of Risk Management for Investors Title Insurance Company, says victims have lost hundreds of thousands of dollars. “On the vacant or unoccupied property, I think it was $980,000 on wire fraud. I’ve heard numbers that got well into, well over a million bucks.”
There are several ways you can protect yourself. One is to ask your real estate agent many questions about the seller. Cronkright says, “As a buyer, really ask the questions around, have you met the seller?? How did this listing come through?? If you’re working with a real estate agent as a buyer, make sure they’re asking these questions of the listing agent.”
Also, be wary of a seller willing to accept an offer below market value in exchange for a quick cash sale. And never allow a seller to arrange their own notary closing. Instead, make sure you use a trusted title company or closing attorney to coordinate the exchange of closing documents and funds.
These tips could keep your money in your pocket and away from criminals looking to take your hard-earned savings.
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