Facts show that real estate professionals, including buyers, sellers, landlords, and renters lose up to a billion-dollar each year due to scams. That is not even the worst of it all; these scammers are also devising new means to become more sophisticated and harder to catch. It is challenging to recover the financial losses that come from their activities.
The scams within the industry come in different ways and employ various strategies. Therefore, to make a successful deal, one must learn the good side of things. You should also learn to protect yourself and your clients from these rotten eggs. When these scammers commit the crimes, they target the otherwise most beneficial properties. But, there is good news!
Suppose you can develop your proactive ability as a professional buyers agent. In that case, you can easily spot red flags as warnings against some real estate properties. You can then build protection for both yourself and your client, who is the buyer. This article will show some common strategies that scammers employ. It will also offer ways of mitigating the risk and standing tall against them. Let us begin by showing some sneakiest ways such scams occur. You can read about the best Buyers Agent in Sydney by visiting https://henderson.com.au/.
A Closing Wire Fraud
In this real estate fraud, the scammer begins to hack into the email inbox of a target party in a real estate deal. It is often the closing or title company that is the principal party. It may be relatively difficult to detect these hacks because the scammers simply check and follow the mails when these hacks happen. As the communication goes on, they will be planning which ends of the interaction to attack.
Meanwhile, closing wire fraud is not very common on our list today. However, it still requires that we learn about it and the ways to prevent it. The primary reason is that this fraud can cause the most devastating effect on our clients. By the time the closing period of the deal is closed, the scammer generates a fake email to address what they have been observing. They sound like the email comes from a reputable source by providing the buyer’s true identity and providing fake wiring instructions for the closing funds. Remember that the closing funds will include the down and other payments, which will now be wrongly wired to the scammer’s account.
Similarly, the unsuspecting buyer transfers the money through wire payment to the incorrect details without confirmation from the closing company. The amount sent may often range from a few thousand AUD to several thousand. And suppose the fund is sent to unregulated or offshore banks with nefarious accounts. In that case, it is challenging to trace or reverse such a payment. In fact, it may mean that the money is lost forever. You can read about Hacking refers to unauthorized access to a system or network, often to exploit a system’s data or manipulate its normal behavior. by clicking here.
Any theft at this level usually leaves the buyer completely distressed while also affecting the seller in one way or the other. The implication is that the seller now finds it defective to find another buyer for the property. At the same time, closing wire fraud impacts the real estate industry. The reason is that consumers now seem to have lost confidence in the system and its operation.
How to protect your Clients from Closing Wire fraud
The warning signs during the closing wire fraud plan are difficult to detect because the steps of the scammer are hidden. Most of the groundwork is done in the background and in a way that hardly touches any interaction. The scammer does this during this period to mark out specific vital information. But there is a big way to protect yourself and your client.
When you or your client interact, ensure you spell out where the wiring instructions are coming from for funds transfer. And when the seller receives the instructions, he ought to double-check the authenticity, even if the source came from a regular email. Therefore, have clear communication about who is sending what information, where is it coming from, and when will it arrive. If any data arrives outside those specifics, that is a wrong signal.
An average email user should recognize that the email contents are sensitive and should be treated accordingly. And if there is a need for sending any more sensitive information, such as the account details for wire transfer, ensure you employ all the security protocols. One way to do that is to activate a 2-factor authentication that can keep your account secure from third-party access. Also, keep all business communication by email in a single place only.
Fake Rentals on Craigslist
Craigslist contains enormous opportunities for getting prospects and leads for massive business deals. Anyone who uses or has used it should know that already. On the other hand, the platform can also harbor some highly shady characters and personalities. The real estate sector is no exception. Let us describe how some of these scams from Craigslist perpetrate their craft.
The first step is that they go to a real estate website like Zillow and create an account. They capture the listing information for the listed properties on the market. Alongside the basic information about the property are photos, descriptions, and other information to make the scam look legitimate. The next step is to use craigslist to create a fake ad for a rental property, and they use the details from the property listing.
When listing the property using the ad, they will state a lesser rental rate than the market value. That step is to attract searchers to think of it as a fantastic deal. And then, the innocent buyer begins to communicate with the scammer. The buyer must have paid before realizing the ad is fake because there is no home to see, and the supposed agent is fake.
How to protect yourself against Fake Craigslist Rentals
As an honest seller, the first protective measure is to start checking Craigslist for the possibility of using your property as fake rentals. The process could be an uphill issue, but after careful and location-filtered sorting, you will find it in no time if it is there. If you have a renter as a client or a buyer’s agent, you should pick the right attitude towards any offer that appears too good. At the same time, ensure you are the first point of contact with any potential homeowner.