Did you know there is such a thing as seller impersonation fraud? If not, we want you to know about it.
Seller impersonation fraud is on the rise recently and it’s when a criminal impersonates property owners by trying to sell property they don’t own in order to steal funds from buyers. If successful, the incident would create a cloud on the title, which would have to be cleared up before the real owner could sell it. That’s scary, isn’t it? However, awareness is the best defense. Once you’re aware, you can take steps to protect your property. Continue reading for our key takeaways.
What is Seller Impersonation Fraud?
Seller impersonation fraud can happen with any property. However, more vulnerable properties are those which are unoccupied, such as vacant land, short term rentals and second homes. This is because they often have less oversight from the owner. The criminal looks for properties free of a mortgage or lien, or with different mailing addresses.
They then contact a real estate agent to list the property. They will try to list it below market value to drum up immediate interest and will try to sell it for cash.
If they make it through the title examination and the sale is funded, all the buyer’s funds would then be stolen.
Things You Should Know
1. We know the red flags.
Because all our agents are seasoned REALTORS, we will know when something is off. One benefit of having seen and dealt with hundreds of transactions over our careers is knowing how an authentic seller typically acts when selling a property. If something doesn’t seem right, we’re going to follow up with due diligence. If a new seller is unknown to us, we verify their identity and do our research into the property being listed for sale.
2. Title companies are working hard to prevent seller impersonation fraud.
Our local title companies are our allies and a crucial line of defense in the transaction. They are aware of the increased threats of cybercrime in real estate transactions and are actively working to implement new systems of detecting and preventing fraud before there are any serious repercussions.
3. There are things buyers can do.
Buyers: be suspicious of deals that seem too good to be true. If a property is priced way lower than market value, think twice and investigate it further. Check for “For Sale” signs in the yard. If the true owner of a property is actually selling their property, there is more likely to be a sign out front.
4. Tools have been made available for property owners.
If you’re a property owner, there are things you can do as well. First, if you don’t live on the property, make sure the Appraisal District has your correct mailing/forwarding address (you can request a change here). Second, set up fraud alerts with Bell County Appraisal District. Because of the rise in fraud, many appraisal districts have implemented this tool to help warn owners when there is activity concerning their property.
Standing Strong Against Seller Fraud
Awareness is key. Spread the word to your family and friends who own or are looking to purchase property. An educated buyer and informed seller are always our goals!