If you’re buying or selling a home, that’s likely one of the largest financial transactions you’ll ever make – and one of the most confusing. That’s why scammers are attracted to the process. Now that many of the documents and transactions are handled online, it’s also easier to pose as a legitimate party and divert money.
The FBI reported that nearly 10,000 people in the U.S. were real estate fraud victims in 2024 and lost a total of more than $170 million. There were likely many others who were too embarrassed to report being victimized or didn’t think it would do any good.
How scammers fool people
One way to help avoid a real estate scam is to ensure that you are dealing with a licensed real estate agent. Scammers often get business by telling people they can avoid having to pay a commission by buying or selling directly. They often offer terms that seem too good to be true – because they are.
Scammers may encourage people to skip over steps like an inspection. However, these steps are there for a reason. They help buyers ensure that the property they’re buying doesn’t have any hidden defects.
Even if you have a legitimate real estate agent and think you’re doing everything by the book, scammers can pose as your agent online or as someone you haven’t met – like someone from the title company or your lender. In the later stages of a home purchase, large sums of money are moving around via wire transfer, which is how a lot of scammers make their money.
It’s critical to confirm that anyone telling you where to transfer funds, to sign something online or take some other action is who they say they are. Any last-minute change in information, a message from an unfamiliar phone or email address or pressure to respond immediately should be a red flag.
Having trusted real estate and legal professionals guiding you through the home buying or selling process may take a little more time and money, but in the long run (and even in the short term), it can prevent you from falling prey to scammers.