If you’re in the market for a home, you’ve likely worked hard to build up a down payment. Fraudsters know this and look to identify potential homebuyers, as they’re hoping to get their hands on the cash you’ve saved up for a house.
One of the most common ways scammers trick homebuyers is through mortgage wire scams. Read on to learn what these scams are and how to spot them.
When you’re buying a home, you’ll eventually need to pay out the down payment you’ve saved up. The types of payment accepted for this may vary based on your unique situation, but it’s traditionally done by bringing a cashier’s check for the specified amount to your home closing meeting. This is when scammers often interfere.
Scammers will try to gain access to information about potential homebuyers and get them to send their down payment funds to a fraudulent account before they go to closing, typically via a wire transfer. Two common ways scammers gain access are listed below.
Fraudsters will then create a fake email address that mimics the legitimate email address of someone the buyer trusts in regards to the mortgage, such as the lender, real estate agent, or settlement company. Since they know that you’re busy and possibly overwhelmed as closing day approaches, they hope that you won’t notice the slight difference in the address, such as an additional letter or a slightly different email domain.
In either of these cases, if the buyer doesn’t identify the email as a scam, they’ll unintentionally, but willingly, hand their down payment over to the scammer. Unfortunately, in some cases, this money can’t be recovered, and the homebuyer is no longer able to purchase the home.
It can be unnerving to hear about these scams, especially if you’re preparing to purchase a home yourself. However, there are steps you can take to protect yourself so you can confidently move forward with your homebuying plans.
Knowing how to spot a mortgage wire scam can help you make your homebuying dreams a reality without the worry of a fraudster interfering. For more information on keeping yourself safe from scams, visit the Security section of our blog.