The Nevada Real Estate Division has informed us of a concerning issue that has been on the rise in our community – real estate identity theft & fraud.
Buying or selling a home is an exciting and significant milestone in your life as is renting out a property an important investment. All of these are major decisions that affect you and your families’ financials, and we need to be able to safeguard your investments. However, it's essential to be aware of potential risks, such as real estate identity theft and fraud, to safeguard your personal and financial information during this process.
What is unique about these incidents is that real estate licensees have also fallen prey to these frauds and fraudulent activities. Historically we have seen “straw buyers” who bought properties and provided fraudulent information to the banks resulting in cash outs. They then walked away from properties leaving the banks holding a note that was worthless as they carried the “2nd or 3rd note” on the property and couldn’t foreclose because of the originating bank’s 1st position. Now, these scammers are either posing as:
- Sellers and sell the homes with fraudulent documentation they provide to escrow and notaries and walk-away with the proceeds only to have the rightful owners being left without a property they worked so hard to have – it may be a 2nd home or an investment property with out of state owners but now it’s gone and so are their savings.
- By acting as landlords and collecting thousands of dollars in deposits & first & last month’s rents of multiple tenants and then skipping and leaving these “tenants” to be evicted as they legally don’t have a right to be there costing owners thousands of dollars of court costs & potential damages caused by the frustrated tenants that were taken advantage of – losses for all but the scammers who profited handsomely.
Real estate transactions are inherently complex. Buyers and Sellers rely on licensed professionals to help them navigate these transactions. It is imperative for clients, real estate agents, escrow, title & insurance agents involved in a real estate transaction to stay informed and vigilant, now more then ever.
Licensees are in the business of appealing to a wide audience and their success may be heavily contingent on this factor. Real estate professionals have every incentive to create positive experiences for their clients, however, licensees are also obligated to ensure a real estate transaction complies with all federal, state, and local laws & regulations and now they have the added layer of having to prove you are the rightful owner before proceeding with a transaction.
To better protect their clients in this ever-evolving era of identity theft in real estate transactions, please be patient as additional information is requested to ensure you are the actual Seller, Buyer or Landlord for a particular property.
Real estate agents will now start asking clients to:
- Verify that a seller owns the property they are trying to sell, rent, refinance, etc. This verification is crucial to ensure the legitimacy of the transaction and protect both the buyer and the seller.
- They will thoroughly research the property and its history before making any commitments. This includes checking ownership records, property taxes, liens and any other relevant information.
- They will require you to provide ID and possibly other forms showing correlating addresses.
Please remember that they are not trying to be intrusive but trying to protect you in the event a scammer is trying to impersonate you to sell or lease out your property.
As your real estate agent, we are here to guide you not only in finding your dream home or renting out your property but also in protecting your interests. Here are some essential tips to help you stay safe:
1. Secure Your Personal Information
The first step in protecting yourself against identity theft is to secure your personal and financial documents. Keep sensitive documents like your social security card, bank statements, and tax records in a secure location. Consider using a locked safe or a safety deposit box for added protection.
2. Use a Shredder
Do not just throw away any document that has your name, birthdate or other sensitive information. For a small investment, buy a shredder and shred everything so no one can access your trash for your personal information. Shred all medication labels of unused bottles as well since the “patient” bars that can be scanned contain valuable personal information like name, date of birth & insurance information.
3. Use Strong Passwords
In today's digital age, online transactions are common in real estate. Use strong, unique passwords for your online accounts. These passwords should include a combination of letters, numbers, and special characters. Avoid easily guessable information like birthdays or names.
4. Beware of Phishing Scams
Stay vigilant for phishing scams, where scammers send deceptive emails or messages. These messages may request personal information or contain suspicious links. Always verify the legitimacy of such messages before taking any action.
5. Verify Communication
Before sharing sensitive information, verify the identity of anyone who contacts you regarding real estate transactions. Independently confirm the contact information for your real estate agent, title company, or any other parties involved in your transaction. Call the phone number given to you by your agent for the title company prior to ever wiring funds to ensure it is going to the right place.
6. Never provide sensitive information over the phone to unknown callers
Title companies, banks, credit card companies, etc. will not call you and ask you for personal information to verify. If they do, feel free to hang up and call them back on a number you have on record to confirm they are looking for specific information & then provide. Scammers have gotten really good at creating frightening scenarios to get you to “wire a relative money”, etc. – don’t fall for it! Title companies are now using encrypted emails but check with your agent first to ensure the email is legit before submitting any information.
7. Secure Wi-Fi Networks
When conducting online real estate transactions, use secure Wi-Fi networks. Public Wi-Fi can expose you to security risks. Consider using a virtual private network (VPN) for added security.
8. Regularly Monitor Your Credit Reports
Monitor your credit reports regularly for any suspicious activity. You can obtain free credit reports annually from the three major credit bureaus. Investigate any unfamiliar accounts or inquiries promptly.
9. Use Encrypted Communication
Protect your sensitive information by using encrypted communication methods. Consider using electronic signatures or secure document-sharing platforms during the transaction process.
10. Understand Title Insurance
Title insurance offers protection against fraudulent claims on the property title. Familiarize yourself with this valuable safeguard, which can provide peace of mind during your real estate transaction.
11. Report Suspicious Activity
If you suspect any fraudulent activity or identity theft related to your real estate transaction, report it promptly. Contact your local law enforcement, the Federal Trade Commission (FTC), and credit bureaus to take appropriate action.
12. Register with the County/City Recorder’s office
Register with the County/City Recorder’s office where your property is located so they can notify you if anything is filed against your property. At least you can contact them immediately if you see a lien or a property transfer or anything suspicious being recorded against your property as soon as it happens, and you can alert the proper authorities to try to stop any illegal transaction.
13. Stay Informed
Awareness is your best defense against fraud so stay informed about the latest scams and fraud tactics prevalent in the real estate industry.
Protecting yourself against identity theft and fraud is crucial, and your real estate agent is here to support you in this journey. By following these tips and staying informed, you can ensure a safe and secure real estate experience.
Remember, your safety and security are our top priorities, and we are here to guide you every step of the way. If you ever have any concerns or questions, don't hesitate to reach out to us. Together, we can make your real estate journey a successful and secure one.
