While buying property is a significant and exciting life event, it also involves a substantial amount of money, making it a prime target for criminals looking to swipe your savings. But how do these thieves accomplish their nefarious deeds? The answer: seller impersonation scams. Let’s discuss what these scams are, how they occur, and the red flags that will prevent you from falling victim to them.
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What are Seller Impersonation Scams?
Seller impersonation scams are a growing issue that is plaguing the nation, so much so that the United States Secret Service has issued a bulletin on seller impersonation scams. According to them, these scams occur when cybercriminals search public records to identify vacant real estate that is free of mortgages or other liens as well as who the property owner is. Once found, the scammer will pose as the owner through electronic communications and have the property listed for sale below the market value, attracting unsuspecting victims who will quickly send them cash to purchase the property. Once the transaction is complete, the cybercriminal gets the sale proceeds, and the victim gets nothing but an empty wallet with no property to show for it.
It’s a dubious scheme, but not unavoidable. Millennial Title thwarted five attempts of seller impersonation scams in the last year. So how did we stop it? Simple: by staying vigilant and identifying the warning signs of seller impersonation scams. To secure your transactions from cybercriminals, here are five red flags of seller impersonation scams you should be on the lookout for:
1. The property is advertised significantly below market value: Everyone loves a good deal, but often if it seems too good to be true, it probably is. Ask the seller why the property is listed so low. If you receive an answer that’s vague or doesn’t make sense, something foul may be at play.
2. The “seller” can’t meet locally and only reaches out through email or text: Face-to-face meetings, video calls, and even phone calls can unmask a criminal pretending to be the property owner; therefore, they’ll avoid them at all costs. If a “seller” only emails or texts with odd excuses for why, it’s a red flag.
3. Sharing necessary documentation is difficult: An unwillingness—often veiled as ignorance—to send or receive documentation can signal something is wrong. “Sellers” who fail to share a form of legible photo ID or unreturned paperwork show the signs of impersonation scams.
4. The “seller” is insistent on who can and can’t be included in the transaction: If the “seller” is adamant about not using a real estate agent or title company, or demands to use their own agent or notary, chances are it’s a scam. You should always be represented by your own agent and go through a title company and escrow services to ensure complete transaction security.
5. The “seller” is willing to offer incentives or cut corners to complete the closing as quickly as possible: A “seller” who pushes for a closing within a few days of agreeing on a price should be a glaring warning, especially if they’re willing to make it happen by any means necessary.
Protect Yourself from Seller Impersonation Scams and Other Schemes
Seller impersonation scams can cause a lot of havoc, tricking buyers out of their savings as well as their dreams of owning a property. By knowing the red flags, you can better identify and stop these terrible crimes before it’s too late. At Millennial Title, we always recommend you close with a title company and send funds through an escrow service to ensure your sending funds to the proper party. Our team is dedicated to keeping a keen eye out for impersonation scams and protecting our clients at every stage of the closing process. If you’d like to learn more about how you can protect your real estate transactions, consider reading our tips for identifying and preventing wire fraud.
