Common Real Estate Scams

The most common forms of scams I see in my real estate business are rental scams involving deposits and earnest money and wire fraud. I have had the local Sherriff's Department contact me looking to track a rental scam prospect down. 

One of our agents recently had his father in law's residential property listed for sale. He was online and saw where someone took the pictures of the house and posted that the home was available for lease when it in fact was not. The scam artist was cold calling prospects to rent the property. He just happened to contact our agent's friend, so she called our agent and made him aware of the scam. The scam artist was using the money payment application, "Zelle", and asking the prospective renters to put both a security deposit and first month's rent down. He created urgency by telling people they had to put the money down as soon as possible or someone else would lease the property. The scam artist took $3,000 from someone. He used the payment application Zelle because it is harder to trace. 

People need to do their due diligence when looking at properties to lease or buy. I would recommend using a trusted Realtor to represent to help avoid these type scams. 

Another type of fraud I commonly see is wire fraud. Buyers typically wire in their earnest money as part of a contract. Buyers need to make sure that they have the correct wiring instructions from the earnest money holder. Do not open suspicious e-mails from people you do not know. Real Estate closing attorneys, that typically hold earnest money as part of contracts, can call you or e-mail you with correct wiring instructions. We see scam artists create e-mail addresses and pose as the closing attorney asking for the earnest money or funds to purchase a home. They will change a letter off of the closing attorney's e-mail address and hope their target does not notice. The scammer will then try to get their target to wire the money to the scammer's account instead of the real estate closing attorney. With home purchases, we are talking about losing a significant amount of money. 

My suggestion here would be to close with a trusted real estate attorney and have your realtor double check everything, including wiring instructions, before you send. You could also call the closing attorney before you send the wire to make sure the wiring instructions are correct. Wire fraud is very common.