Mortgage Scams & How to Protect Yourself

Don’t Fall for a Mortgage Scam—Here’s How to Protect Yourself

In today’s world, scams are becoming more sophisticated, and unfortunately, the mortgage industry is no exception. Homebuyers and homeowners in Raleigh, NC are often targeted by fraudsters aiming to exploit their lack of knowledge during the complex mortgage process. As a trusted mortgage broker specializing in residential mortgages, my goal is to empower you with the knowledge and tools to protect yourself from falling victim to mortgage scams.

Common Mortgage Scams to Watch Out For:

1. Wire Fraud One of the most prevalent scams involves wire fraud. Fraudsters hack into email accounts and send fake instructions to borrowers, tricking them into wiring their closing funds to a fraudulent account. These funds are nearly impossible to recover once sent.
2. Foreclosure Relief Scams Homeowners facing financial difficulties are often targeted with false promises to save their homes from foreclosure. Scammers demand upfront fees but fail to deliver any real assistance, leaving the homeowner in an even more precarious position.
3. Reverse Mortgage Fraud Seniors are particularly vulnerable to reverse mortgage scams. Fraudsters manipulate appraisals and skim equity, often leaving seniors with far less financial security than they anticipated.
4. Bait-and-Switch Tactics This scam involves advertising attractive mortgage rates and terms to lure in borrowers. Once the borrower is committed, the lender switches to less favorable terms, leaving the borrower stuck with a deal they didn’t expect.

How to Protect Yourself

While scams can be intimidating, staying vigilant and informed is the key to protecting yourself. Here are actionable steps you can take:

1. Work with Trusted Professionals Choose your mortgage team carefully. Verify that your broker, lender, and any other professionals involved in the transaction are licensed and reputable. You can check credentials through official state licensing websites or professional associations.
2. Never Wire Money Without Verbal Confirmation Before wiring any funds, always confirm the instructions with your lender or title company via a phone call to a trusted number. Avoid relying solely on email communications, as these can be easily manipulated.
3. Trust Your Instincts If something doesn’t feel right, it probably isn’t. Whether it’s an unfamiliar term in your contract or an unusual request for payment, don’t hesitate to ask questions. If you’re unsure, seek advice from a HUD-approved housing counselor.
4. Educate Yourself About the Process Understanding the mortgage process will make you less susceptible to scams. Take the time to research terms, procedures, and common practices. A knowledgeable borrower is a confident borrower.

Why It Matters

Falling victim to a mortgage scam can have devastating consequences, from losing your hard-earned savings to jeopardizing your ability to buy a home. By staying informed and vigilant, you can navigate the mortgage process with confidence and peace of mind.

As a mortgage broker, my priority is ensuring your safety and success on your journey to homeownership. I’m here to answer your questions, guide you through the process, and connect you with trusted professionals who have your best interests at heart.

Stay Safe and Informed

The best way to protect yourself is to stay proactive and informed. Follow these steps, work with trusted professionals, and don’t hesitate to ask for help when needed. Remember, you’re not alone in this journey.

For more tips on avoiding scams and making smart mortgage decisions, follow me on social media. Together, we can make your path to homeownership safe and successful.