Buyers Beware: You Could Lose Your Down Payment If You’re Not Careful
West Knoxville buyers need to beware: wire fraud is a real threat. You could lose your down payment if you’re not careful.
In this post, we’ll take a closer look at wire fraud is and how to protect yourself when you buy a West Knoxville home.
What Is Wire Fraud?
Wire fraud occurs when someone involved in the transaction gets email gets hacked. A buyer, seller, realtor, mortgage company or title company may have their email hacked without realizing it. The hacker will monitor their email and look for pertinent details about the transaction.
Here is how the scenario can play out:
Wire fraud affecting a buyer happens when a buyer gets instructions to wire funds to a place other than the title company. Usually, a buyer will receive an email from either the title company, lender or their realtor asking them to wire the funds somewhere other than where they may have previously been told. This email often appears authentic because it’s coming from a realtor or title company’s email. When buyer wires the money, it goes to the wrong place, leaving the buyer out of thousands of dollars.
Why The Threat Is Real
Real estate transactions involve a lot of money changing hands, which is why they’ve often been a key target of criminals. While the scams change from year to year, there’s always some type of ongoing threat targeting real estate transactions.
In recent years, if you’ve paid attention to any real estate news, you’ve probably heard of wire fraud. There are stories all over the news about buyers losing their down payment. Just this year, a couple in California lost their $400,000 down payment to wire fraud or the couple in Denver that lost their $272,000 down payment.
Wire fraud is a real threat if you’re not careful. Next, we’ll cover what you need to know to protect yourself against wire fraud.
What Can Do To Protect Yourself
Here are a few things you can do to protect yourself.
Don’t Open Suspicious Emails
All wire fraud starts with email. In order to be able to commit wire fraud, hackers must gain access to someone in a transaction’s email. You should be wary of opening any strange or suspicious emails. If an email seems suspicious, err on the side of caution and call the sender prior to opening.
Know Your Contacts
In order to be sure you’re corresponding with the right people, it’s important to know who is involved in your real estate transaction. Be sure you know who is handling your closing and what company they are with.
Also, be sure that you know how they will be corresponding with you over the course of the transaction. This will make it easy for you to spot anything out of the ordinary.
Follow Up With A Phone Call
Even when you know who you’re corresponding with, when it comes to wiring money, it can be smart to follow up with a phone call.
Prior to sending out your wire or receiving wiring instructions, be sure to call your title company to confirm it’s going to the right place. This will allow you know for sure that you’re wiring the money to the right place.
Use Common Sense
Finally, in order to protect yourself against wire fraud, use good, old common sense. Pay attention to what your gut is telling you. Here are a few things that should raise red flags:
- You were previously told to send funds somewhere else.
- The bank on the wiring instructions isn’t local.
- The new instructions come at the last minute.
Most title companies will bank with a local bank and won’t be scrambling at the last minute to change what they’ve already told you. If this happens, double check with a phone call to verify.
Are you looking to buy a West Knoxville home for sale? If so, please let us know if there is anyway we can assist you with your home search. You can contact Rick at 865-696-9002 or via email at Rick@KnoxvilleHomeTeam.Com. You can contact Kati at 865-392-5880 or via email at Kati@KnoxvilleHomeTeam.Com. Also, be sure to check out our West Knoxville Home Search Page to see what homes are for sale in the Knoxville area.