When you receive instructions to wire your money to the escrow closing account, there are still a few moving parts left.
This is a time for extra caution on your part to avoid being tripped up by mortgage wire fraud.
Mortgage Wire Fraud Has Gone High Tech
It’s never a good idea to email your financial information to others, and this is especially true when large amounts of money are involved.
Although you might think your email is secure, email accounts are one of the easiest electronic communications methods to hack. Even if you are comfortable with the security of your email, you can never be sure about the email accounts of the others involved with closing your home purchase — not even professionals who you trust.
The most common mortgage wire fraud involves what is called “phishing.” The criminal hackers specifically target the email accounts of professionals in the real estate industry. Hackers are well aware that large amounts of money are involved in these transactions.
Once the account of a real estate professional is “hacked,” the criminal monitors messages for specific words and phrases like “closing,” “escrow” and “wire transfer.”
A Simple Trick
Internet “bots” are often used to find these words and direct the hacker to the email where the words were found.
The hacker doesn’t even need to intercept the email; the most common form of mortgage wire fraud begins with the hacker sending the homebuyer a follow-up message saying there has been a change in the money transfer instructions.
The homebuyer is then directed to a new bank account controlled by the hacker.
The fraud might seem high-tech by using bots, but it’s as simple as changing the wire transfer instructions.
So simple that many unsuspecting homebuyers have lost huge amounts of money and most importantly, the ability to purchase the home.
Don’t make the mistake of thinking you can’t become a victim of mortgage wire fraud.
Mortgage Wire Fraud Occurs Too Often
The scam works so well that it has gone up in frequency by 1,000% since 2015. The FBI says that almost $150 million was lost to these types of scams in 2018 alone.
Avoiding mortgage wire fraud is just as simple as the scam itself.
You can still trust the real estate professional you’re doing business with. You just don’t want to trust being given an account number from what might be an anonymous source.
If you’re confident you can recognize the voice of your agent, escrow officer or other professional over the telephone, you can receive the money transfer instruction that way.
But don’t accept the instructions from an assistant, work associate, or anyone else whose voice you don’t know. When large amounts of money are involved, doing business face-to-face can be your best choice.