We’ve all heard the horror stories about hackers infiltrating real estate transactions to steal closing funds. As fraudsters become ever more sophisticated, we all have to be vigilant to protect ourselves.
What are the latest tactics?
Fraudsters create emails that appear to be from an escrow officer—known as “spoofing”—and ask you to re-route funds needed to close their transaction. And, because they know responsible settlement professionals have begun using call-back procedures to validate and verify emails regarding wiring of funds, thieves also may try calling you using prepaid “burner” phones and applications that can spoof the caller ID of any phone number the caller chooses—even valid phone numbers of actual businesses.
How do they get the information?
The fraudsters hack and monitor non-secure communications between agents, buyers and sellers to gather information about the transaction. They then copy an email template and pose as the escrow officer in a message to clients. They may even add publicly available information about the “sender’s” personal identity that can be found on flyers, company web pages and social media to help make the message appear legitimate to the unsuspecting recipient, who then acts accordingly not realizing that their response is being routed to a hacker who is trying to steal their funds.
What can you do to help prevent this fraud?
While you can’t stop hackers from impersonating parties in a transaction, you can minimize the likelihood that you might act on fraudulent instructions.
- Make sure you (or anyone you know) who is buying a home understand that a title company’s wiring instructions should never change. If you are ever asked (via an email) to change the wire information, it’s probably a scam. Contact your title company to verify the wiring instructions and verify that your lender has the proper information to wire funds to your title company.
- Many title companies use encryption to protect confidential information going back and forth through email. However, be aware that if you forward that email through an unsecured method, the encryption—and hence the security of the information—is lost.
- If you suspect an email account has been spoofed, pick up the phone and speak with your escrow officer directly. Don’t use email for any communication if you believe an account has been compromised.
Buyers are prime targets for fraudsters, but title companies, today, have established a number of procedures to help keep them safe.
Make sure you are aware of this latest scheme so you can avoid becoming an unwitting victim.
The article, Down Payment Ignorance Persists, from www.realestateeconomywatch.com, reports that Despite FHA, more than 2000 down payment assistance programs are available.
These are available from Fannie Mae, Freddie Mac and private lenders ranging from Wells Fargo to Bank of America!
Yet, most consumers don’t realize they can buy a home with less than 10 percent down today.
Here is the link to the entire article: http://www.realestateeconomywatch.com/2016/09/down-payment-ignorance-persists/
It’s more affordable to buy a home now in most U.S. metros than it was 15 years ago, even for millennials putting down less money on a home, according to a Zillow analysis of third-quarter income and home value data.
Check out the housingwire.com article for more details.
Fannie Mae and Freddie Mac announced recently that they will start backing mortgages with down payments of as little as 3% of the home’s price. But borrowers will still need to meet strict criteria first, the two government-backed mortgage giants said.
See the CNNMoney article for details.
Foundation Problems to watch for when searching for a new home.
Many home buyers are rightfully concerned about the condition of the foundation on their pending investment. Whether caused by mechanical defects, or by ‘mother nature’, Foundation Problems are something to watch for when searching for a new home.
One of the big problems that we have here in the desert is a condition known as ‘expansive soil’.
This is where there are veins or layers of a clay known as ‘expansive soil’, that is very reactive to moisture. With the addition of some water, like during a monsoon rainstorm, this expansive soil can swell to many times it original volume. Then, during a span of very hot and dry conditions, this soil will then shrink again to its original volume, or maybe a little less. These changes can have an adverse effect on foundations, sidewalks, driveways, pools, etc.
I have prepared a video showing some of the more severe settling effects on a property that would raise a red flag on its condition. In a case such as this, a certified foundation inspector should probably be hired to check things out.
Foundation Problems. What to watch for when searching for a new home.
Termites. What to watch for when searching for a new home.
I have found over the years that many buyers are not aware of the termite conditions here in the valley. A large percentage of the out of state buyers and a good number of in the area buyers are not fully knowledgeable on termites here in the desert.
In the Valley of the Sun, the termites are the subterranean variety, meaning that they live underground and emerge from their habitat to find food (wood). This is the reason to know about Termites and what to watch for when searching for a new home.
Here is a video where I am showing some signs that there are termites in a property. This is useful for both the buyer, and a current homeowner, as the property needs to be properly treated to stop and prevent infestation.
There is an old saying here in the valley that says:
‘There are two kinds of homes in the valley, those with termites and those that will get termites’.
In essence, this means that since termites live everywhere in the desert area, the best thing is preventative treatment.
When a home is built, the soil beneath the foundation and the slabs are heavily treated with chemicals to keep out the termites. However, over time and with a host of environmental conditions, the treatment can wear out. This is where a maintenance program with periodic checking and re-treatment will keep these little buggers out! A good investment for the buck to protect your property.
Termites. What to watch for when searching for a new home.
Why does a Short Sale take so long? What is going on in this process and how does it work?
Short Sale Process Flowcharts
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