No matter if you are buying, selling, or even refinancing a home, when preparing for your home closing you should be aware of the dangers of sharing money via technology.
In 2019, the FBI reported $221 million in losses due to Real Estate wire fraud, which was a $71 million dollar increase compared to 2018. Additionally, this survey reported that only 15% of all wire fraud incidents are reported.
That is why it is so important now more than ever to be educated and understand this internet crime.
How it works
If your title company or Real Estate agent does not have a secure e-mail server, hackers can break in and monitor the correspondence and determine the exact timeline and details of your closing.
Scammers can then pose as the agent and instruct the home seller or buyer to wire money to a specified account. They will ask for closing funds to hold in escrow, down payments, or even small fees associated with the closing – anything they can get their greedy hands on.
And it doesn’t just stop there. If you choose to work with a company that does not keep sensitive financial details stored in a protected server, hackers can even access your information long after your closing has been completed.
Why is it getting worse?
The honest truth – not all title companies and Real Estate agents use an encrypted e-mail server. Without this protection, they are practically inviting hackers to take a sneak peak at personal and confidential records.
Unprotected communications are not the only issue. Many buyers and sellers are not being careful with whom they are e-mailing with.
Real Estate professionals urge their customers to carefully check where a suspicious e-mail may be coming from. It is also recommended that the customers change their passwords to secure passwords with two-factor authentication.
Read more about additional ways you can up your cyber-security game.
How to combat it
In addition to the above suggestions, the easiest way to ensure your financial details stay secure is to verbally communicate with your Real Estate or title agent directly.
When sending money electronically, call your Realtor or title company to confirm the transfer. Make sure you are using a verified and legitimate phone number. Many scammers will include false contact information within their e-mailed communications.
Furthermore, you can choose to forgo e-mail communication altogether and have your money routed directly from your bank account via a secure link or other services your title company may provide.
When sharing personal documentation with your Realtor, lender, insurer, title agent, or anyone for that matter, be sure to present this information either in person or via a secure online portal.
What it all comes down to is to do your research when picking the person you will be sharing sensitive information with, make sure they have systems in place for cyber-security, and to be very cautious throughout the closing process. Always share in person what you can whenever possible.
