Closing on a new home is one of life’s most exciting milestones, but it also comes with financial risks — especially due to increasing mortgage closing scams and wire fraud. Scammers have been known to target homebuyers during the closing process, attempting to divert large sums of money into fraudulent accounts through phishing schemes. Falling victim to one of these scams can mean losing your down payment and closing costs, sometimes totaling hundreds of thousands of dollars.

At First Financial, we want to ensure our members are informed and prepared during primetime for buying a home – spring. Here’s what you need to know about mortgage closing scams and how to protect yourself from wire fraud.

How Mortgage Closing Scams Work

Fraudsters will often use sophisticated phishing tactics to deceive homebuyers into sending their closing funds to fake accounts. Here’s how they do it:

• Email compromise: Scammers may hack into or spoof the email accounts of real estate agents, lenders, title companies, or attorneys. They will create similar email addresses, changing just a letter or number which often goes unnoticed. If successfully hacked, email conversations are monitored to identify upcoming closings.
• Fake wire instructions: Once they’ve gathered enough details, the scammer will send an email impersonating a trusted party. These emails usually contain official-looking branding, logos, and signatures to appear legitimate.
• Urgent request for a wire transfer: The fraudulent email will instruct the homebuyer to send funds to a different bank account, often citing last minute changes or updates.
• Quick withdrawal of funds: Once the money is wired, the scammer will immediately withdraw or transfer the funds – making recovery extremely difficult, if not impossible.

These scams can be incredibly convincing, and even careful homebuyers can fall victim if they don’t take proper precautions.

Signs of Mortgage Closing Scams & Wire Fraud

• Unexpected last minute changes to wire instructions – If you receive an email stating that your payment details have changed, be extremely cautious and call the title company or lender directly.
• Emails with urgent or high-pressure language – Scammers typically try to create a sense of urgency, making you feel like you must act immediately.
• Slightly altered email addresses – Fraudsters will create emails that look nearly identical to those of real estate professionals, often with minor spelling changes or different domains (e.g., @company.com vs. @company-mail.com). Always double check the email addresses you are responding to before sending money or financial information.
• Requests for financial information via email – Legitimate real estate professionals, lenders, title agencies or attorneys will never ask for sensitive financial details through regular unsecure email.
• Links or attachments from unknown sources – Clicking on malicious links can give scammers access to your email account and financial details.

How to Protect Yourself

• Verify wire instructions in person or over the phone – Before wiring any funds, call your lender or title company using a trusted phone number — not one from an email. Confirm the payment details with someone you have spoken to over the course of the mortgage process.
• Avoid emailing financial information – Email is not secure, and sensitive financial information should never be shared via email. If you need to send any documents, ask about secure portals or encrypted options.
• Be wary of last minute changes – Scammers will often introduce urgent changes to wire transfer details right before closing. If you receive unexpected instructions, verify them with your lender or title company in person or via a known phone number.
• Use multi-factor authentication – Enable multi-factor authentication (MFA) on your email and financial accounts. This adds an extra layer of security by requiring a second form of verification when logging in.
• Monitor your transactions – Follow up immediately with your title company or lender after any transactions to confirm they were received. Any discrepancies should be reported immediately.
• Establish a security code with your real estate team – Work with your real estate agent and title company to create a unique security phrase or code word to use when discussing financial transactions.

What to Do If You Become a Victim of Mortgage Wire Fraud

• Contact your bank – Request a wire recall to try to recover the funds.
• Report any fraud to the FBI – File a complaint with the FBI’s Internet Crime Complaint Center (IC3) at ic3.gov.
• Notify your real estate agent, title company, and lender – They may be able to assist with stopping the transaction or preventing further fraud attempts.

Time is critical — the faster you act, the better your chances of recovering your money.

Protect Your Home Purchase with First Financial

We’re committed to helping our members navigate the homebuying process safely. Whether you’re applying for a mortgage, looking for home financing advice, or seeking fraud prevention tips – we’re here to help.

To learn about our mortgage services check out our Homebuyers Guide and website, call us at 732.312.1500, or visit a branch. Subscribe to our First Scoop Blog for more expert advice on protecting your finances!