Common scams to watch out for when closing escrow

08.09.18 04:43 PM By Paul Cantor

It’s all over but the shouting. You found the house, cut the deal with the help of a qualified real estate professional, and now you’re counting down the days to the move. You might feel as if this is when everything goes on autopilot as you pack boxes and deal with the enormous to-do list before you. But you’d be wrong. Despite your diligence and preparation, scammers and con artists can throw curve balls your way, and you won’t even know what hit you.   The purchase of a home is easily one of the largest lifetime investments you'll make, which means you need to be extra cautious with your money during, before, and after the sale, keeping an eye peeled for these unfortunate real estate scam scenarios:   While you are anticipating the closing date, you get an email from what appears to be your real estate agent with instructions on where to wire your down payment. This has the potential to be  mortgage fraud, but what can you do to guard against it? For one, don’t trust the email address even if it looks legit. Call or email your agent and ask if he or she sent anything looking like this, and chances are good they will be in abject shock.   Cybercriminals are adept at hacking into the email account of someone involved in a real estate escrow, whether it’s the buyer, the seller, any attorneys involved, real estate agents or bankers. These hacked emails tell them all the details they need to know, including your closing date. And as soon as they see your funds in their phony account, your down payment goes the way of that sock in the dryer that is never found again. To guard amassing this, keep communications open with the people involved, both over the phone as well as email, and hand that bank check to someone in person whenever possible, even if you have to pay a courier to do it.   But wait. There’s more. A new homeowner arrives at their new front door and tries the key in the lock only to find that it doesn’t work. Suddenly someone opens the front door asking why you’re there and you peek inside, only to see the  house is already occupied — by renters.   It’s useless to be angry at the occupants, however. These poor folk probably have no idea they were scammed as well. After all, they answered an ad from someone who advertised themselves as the landlord of a vacant property, signed a dummied-up a lease, handed over a deposit, and even got a new set of keys. Your appearance their front door is as shocking to them as theirs is to you. They no doubt already lost not only their deposit but also their first and last month’s rent to this scammer. Whatever transpired, they now have renter’s rights, and you may have to go through a costly eviction process to get your own home back.   Unfortunately, the law hasn’t caught up with this crime quite yet. But there is something you can do if the home you bought had been vacant for a while before closing. Ask your agent and anyone else you can think of to check on it regularly, even peering through the windows. The most you can do is try to catch this phenomenon happening before closing takes place.   So now you think you’re safe. Even with every “i” dotted and every “t” crossed, however, you can still get rooked during the move itself. The federal government receives thousands of complaints every year about  moving companies who offer you a quote and then bills you for twice as much, holding your belongings hostage until you pay up. Some of your items may end up missing as well, only complicating this nightmare.   What to do to protect yourself from this? Check customer reviews not only the website of the moving company you hired; also check sites like Yelp! for what others say about this company, and look up their Better Business Bureau score as well. Get more than one estimate and see how it compares to others to determine if it’s on track for the number of rooms they’re loading up and the distance your belongings are being moved. And by all means, call your insurance agent to inquire about buying some short-term insurance to protect your belongings in the move.   Scams like these continue to happen, becoming even more sophisticated over time, and we're not trying to freak you out. It’s a matter of staying diligent until the very day you hook up the big screen TV. For more information on how to deal with these and other fraud issues, go to your local Department of Real Estate Services website.  Source: TBWS