Nevada warns residents of increasingly common real estate scam
CARSON CITY, Nev. (KOLO) - The Nevada Division of Insurance and the Nevada Real Estate Division are warning residents of an increasingly popular real estate scam.
Known as “vacant lot fraud” or “seller impersonation fraud”, the scam involves bad actors impersonating the owners of a property or vacant lot and trying to sell it for profit.
Scammers will search public records and identify owners of real estate that is free of mortgages or other liens, then pose as its owner and contact a real estate agent to list it for sale. Most commonly, these scammers will target vacant lots and investment, or vacation/rental properties that are not occupied by the owner.
The scammer will then quickly accept an offer, then send false documents to the title firm or closing attorney. The closing proceeds are then transferred to the scammer, leaving the fraud undiscovered until the transferring documents are recorded with the county.
Both agencies are asking people to be on the lookout for these red flags:
According to the American Land Title Association (ALTA), homebuyers and licensed professionals alike should consider conducting additional due diligence or halt a transaction if they see these potentially suspicious seller behaviors:
· Seller is difficult to reach via phone or refuses to meet via video call; only communicates via text or email.
· Seller sets listing price lower than the current market value and wants a fast cash sale with little or no fee negotiation
· Seller refuses to attend signings; always claiming to be out of town
· Seller requests to use their own notary
· Seller demands proceeds be wired
· Seller has a different address than the owner’s address or tax mailing address
· Seller refuses or is unable to complete multifactor authentication of identity verification
Precautions you can take:
ALTA advises title and real estate professionals to take the following precautions during the transaction to help thwart scammer’s attempts early on:
· Send mail to the seller at the address listed on tax and property records
· Ask the seller’s real estate agent if they have personal or verified knowledge of the seller’s identity
· If using a remote notary, be sure the notary is fully vetted and approved by your state; otherwise, the title company should arrange for an in-person notary signing at an attorney’s office, title agency, or bank.
· Contact the seller directly at an independently discovered and validated phone number
· Verify the sellers identify by sending the seller a link to complete a third-party identity verification
· Run the seller’s email and phone number through a verification program
· Ask conversational questions to ascertain seller’s knowledge of property information not readily available in public records
· Compare the seller’s signature to previously recorded public documents
· Use a wire verification service or confirm wire instructions match account details on seller’s disbursement authorization form
· Require a copy of a voided check with a disbursement authorization form
· Require that a check be sent for seller proceeds rather than a wire
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