Avoiding Risks of Mortgage-Related Wire Fraud

Financial fraud through email and wire methods has unfortunately been on the rise for several years, and the mortgage industry is one of those that’s commonly affected. Due to the high dollar amounts often at play associated with mortgages and home loans, along with a number of first-time buyers who may not be fully familiar with the process, scammers often target this area in an attempt to grift honest people.

At Primary Residential Mortgage, our mortgage lender services include helping you avoid any potential for this sort of scam affecting you as you enjoy our quality mortgage rates and variety of mortgage program options. This blog will go over the typical format that mortgage fraudsters attempt to utilize to trick you, plus some basic precautions you can take to stay far clear of any of these risks during your mortgage process.

How it Happens

Generally speaking, wire fraud is a crime where the scammer in question creates a false scheme to steal money based on untrue information. As email and electronic forms of communication have become commonplace for many wire transactions and related financial areas, fraudsters have begun to target email accounts as their way in the door.

During a mortgage fraud attempt, the hacker in question will have gained access to the email address of someone involved in your loan process – your title company, settlement agent, realtor or even mortgage lender. In other cases, they will not actually have access to such emails, but rather will create a new one that’s almost identical but has small, virtually unnoticeable differences.

From here, the scammer will send an email that appears to be from one of your financial professionals. This email will tell you the wire transfer instructions have changed, then will tell you to route money to a different bank account. If you fall for this and transfer the money, it can be very difficult to trace where it was sent and the money may be lost.

Precautions to Take

Here are several precautions you can take to protect yourself from falling victim to these schemes:

• Verify all email addresses associated with mortgage- or wire-related areas. Pay attention to the actual email address itself, not just the signature line.
• If you have any concerns about wiring money, ask if a certified check or cashier’s check can be used instead.
• If you choose to go with a wire transfer, always call your settlement agent to confirm wire instructions before you send any money. If you receive any emails about changing wire instructions, this is doubly important – these emails are not normally sent, and should be a red flag.
• After wires have been sent, call the agent again to confirm money was received.
• Ask for wire instructions you can pick up in person at the agent’s office rather than having them emailed.

For more on how to avoid mortgage-related wire fraud, or to learn about any of our quality mortgage or refinancing services, speak to the staff at Primary Residential Mortgage today.

*PRMI NMLS 3094. PRMI is an Equal Housing Lender. Some products and services may not be available in all states. Credit and collateral are subject to approval. Terms and conditions apply. Programs, rates, terms, and conditions are subject to change and are subject to borrower(s) qualification. This is not a commitment to lend. Opinions expressed are solely my own and do not express the views of my employer.