Real estate fraud comes in various forms, which can make them challenging to identify.

Hackers employ diverse database systems, enabling them to target different groups, especially unsuspecting first-time homebuyers and financially struggling homeowners who are behind on their loan payments. Utilize this guide to help you or your loved ones recognize and safeguard against these common crimes.

Bait and switch

Predatory mortgage lenders use this deceptive tactic to entice customers with low-interest-rate programs and attractive terms and then replace them with more profitable ones for the lender.

Tactics
After you submit your applications, the lender states that the initially advertised loan is no longer an option or that you no longer qualify for the previously quoted rate. This usually results in you paying additional unexpected fees.

Prevention
Ask your lender to offer a rate-lock option for your loan and provide a comprehensive breakdown of all associated fees and terms. Carefully read all the details in the loan document, make sure you understand what it says, and demand answers to anything that’s unclear before putting your signature on it. In addition, you should seek and compare quotes from different lenders in your local real estate market to ensure you’re getting the best offer possible.

Escrow solicitation

Wire fraud occurs when scammers deceive homebuyers into transferring their closing costs and final down payment to a fraudulent account. This often happens in the late stages of a home purchase, when buyers are preoccupied with last-minute tasks, making them more susceptible to falling victim to a scammer’s schemes.

Tactics
The fraudster may impersonate your real estate agent, lender, or title company and send you an email marked as “urgent” and containing updated wiring instructions.

Prevention
Never rely on an email alone for confirmation—it may appear legitimate but very well could be sent from a fake account. Be sure to always call your agent directly to verify any changes. Also beware of grammatical or spelling errors, which could indicate that the letter or email is a scam.

Forced-loan refinancing

This underhanded scheme is designed to steal your money and sell your identity by obtaining your birth date and Social Security number.

Tactics
The scammer poses as a third-party lender and will send you a letter, text, or email informing you that you must refinance your loan. Much like the escrow wiring communication, this may seem on the up-and-up as it usually includes the name of your lending institution, loan number, and amount you owe, along with a phone number to call.

Prevention
Ignore any types of communication from a supposed lender. Reputable lenders advertise through traditional channels such as online and mass media. Moreover, a third party representing the lender would never contact you to modify your loan since you would have to be the one to initiate any changes.

Foreclosure relief

Scammers excel at infiltrating systems to acquire homeowner data, which they subsequently utilize to target individuals facing financial difficulties, those behind on their mortgage payments, or those in preforeclosure. They exploit these vulnerable homeowners through strategies like foreclosure rescue and relief scams.

Tactics
Such people may try contacting you through various means, such as emails, letters, texts, or phone calls, pretending to be government officials or attorneys. They offer to negotiate your mortgage terms on your behalf to prevent foreclosure but demand exorbitant up-front fees for their services. Unsurprisingly, these scammers often don’t follow up on their promises, ultimately leading to your home’s foreclosure.

Prevention
Before engaging with a third-party service, it’s essential to first consult with your lender or mortgage service provider. Additionally, validate the credentials of any mortgage-relief service providers by checking with the US Department of Housing and Urban Development (HUD) before deciding to use their services.

Moving

Similar to bait-and-switch schemes with mortgages, some movers give lowball estimates compared to other movers but then don’t honor the quoted price.

Tactics
After the moving company arrives and loads your belongings onto the truck, they increase the price, claiming that the weight is greater than initially estimated. (Though this can be legitimate, a scammer will knowingly underestimate the cost when you are furnished with the original quote.) Unless you agree to pay the new, higher price, they may refuse to unload your belongings or transport them to your new residence.

Prevention
Extremely low estimates should sound an alarm. Always obtain at least two or three quotes with a “not-to-exceed-price” clause, and get everything in writing before giving a deposit. Also, be sure they provide you with a bill with all the charges at least two days before your move date. Never feel under pressure to work with a mover you have concerns about.

It can be easy to get sucked into a home-related scam unwittingly, so a good rule of thumb is to only give out your personal information to people you know and trust. Always consult with your real estate agent, who can help verify the legitimacy of lenders, movers, and any other outside agencies.