Real Estate Scams And How To Protect Yourself

Buying or selling a home is one of life’s most expensive transactions — and scammers are looking to get in on the action. Nearly 1 in 4 consumers say they experienced a fraud attempt during the real estate closing process, according to the 2025 State of Wire Fraud study by CertifID. And data from the FBI’s Internet Crime Complaint Center shows that in 2024, real estate fraud resulted in losses of more than $173 million.

Before you click on a link or reply to a request for information, read up on the most common real estate scams, and how to protect yourself.

1. Title or escrow wire fraud

How it works

You get an email, phone call or text from someone purporting to be from a title company or mortgage escrow company with instructions on where to wire your funds. Scammers use spoofing tactics to make phone numbers, websites and email addresses appear legit at first glance. But in these cases, one number or letter is often off — an easy thing to miss, says Melinda Opperman, chief external affairs officer at Credit.org, a nonprofit credit counseling agency.

If you blindly follow the wire instructions and assume all is well, you may find that you’ve just become a victim of escrow fraud. The amount lost can be staggering: The median amount of title-related wire fraud in 2024 was $72,000, according to CertifID’s research, with just 28 percent of those funds recovered.

How to protect yourself

Before you send money to a third party, go back to the original documents you received from your lender and call the phone numbers listed there to verify the wiring instructions you received. Never click on email or text links, or send money online, without verifying wire instructions with a live person on the phone from a number that you’ve called and verified, says Opperman.

“Be wary of any email or text requesting a change to wiring instructions you already have,” says Sarah Frano, vice president of corporate underwriting and a fraud risk expert with First American. “Before sending a wire transfer, always confirm the wiring information you received is from your escrow company by contacting them at an independently verified phone number, and once the information is confirmed, let the recipient know that funds are on the way so they can confirm receipt.”

2. Loan flipping and predatory lenders

How it works

Loan flipping is when a predatory lender persuades a homeowner to refinance their mortgage repeatedly, often borrowing more money each time. The scammer charges high fees and points with each transaction, Opperman says, and homeowners get stuck with higher loan payments they can’t afford after being duped into borrowing most of their home’s equity. Predatory lenders may also convince older homeowners they can help them use a cash-out refinance to pay for renovations to make their homes more accessible as they age.

Seniors with memory impairment are especially vulnerable to these types of scams, Opperman says, because they often have significant home equity and might not realize they’re being taken advantage of.

How to protect yourself

Elderly homeowners who have cognitive issues should involve a trusted relative or friend in any key financial discussion, especially about decisions related to their mortgage. If you’ve recently completed a refinance, it’s usually not in your best interest to do another transaction right away, Opperman says. And if lenders are actively seeking you out even though you haven’t requested help, that’s another warning sign that something is off.

If you’re refinancing your mortgage, work only with known banks or lenders, and question all fees and penalties presented to you, Opperman says. Lenders are required to provide loan estimates and closing disclosures that list all fees and third-party costs. Review these documents carefully, or have a trusted advisor do so.

3. Foreclosure relief

How it works

Homeowners who fall behind on their mortgage payments can become desperate to save their homes. That’s when unscrupulous scammers, using public records of homes in preforeclosure, swoop in with offers of foreclosure relief to capitalize on the victims’ vulnerability, Opperman says.

“Scammers will claim that they can help homeowners save their homes and reduce their mortgage payments for a large, upfront fee,” Opperman says. “But they often leave our clients in worse financial shape.”

Some fraudsters claim they’re affiliated with the government or government housing-assistance programs. According to the Federal Trade Commission’s Consumer Sentinel Network, consumers logged more than 26,000 reports for foreclosure relief and other debt management scams in 2023.

How to protect yourself

The best way to avoid foreclosure is to work directly with your loan servicer to modify your existing loan or make some other arrangement. Homeowners can first enlist the help of a HUD-accredited housing counselor to see what options they have, then include their counselor on a call with their lender to find solutions, Opperman says.

“A scammer will tell you not to talk to your lender, and that’s a huge red flag,” Opperman says. “It’s hard to speak to your lender when you’re in imminent default or become delinquent, because you’re afraid it might speed up losing your home, but you have to open the lines of communication.”

4. Fake listings and rental scams

How it works

Scammers frequently post property ads on social media and other online platforms to lure in unsuspecting renters, sometimes using fake photos or images from other listings. The scammers, who have no connection to the property or its owner, will ask for an upfront payment to let you see the property or hold it as a deposit. In reality, they’re just looking to get quick cash through nefarious means.

Unfortunately, they often succeed — rental scams are alarmingly successful. According to Rently’s 2024 Rental Scams and Fraud Report, 70 percent of victims had already paid a security deposit, 59 percent had paid an application fee and 50 percent had paid the first month’s rent.

How to protect yourself

As a general rule, be suspicious of anyone who asks for a cash deposit upfront to see a property, says real estate agent Nicole Dreyfuss with Triplemint in New York City. Dreyfuss also recommends the following:

• “Avoid doing transactions via email or on the phone,” she says. “It’s best to be face-to-face to confirm the property ownership, sign any required documentation and make a payment.”
• Try searching online to find out who the current property owner is and look for contact information.
• Use a check, never cash, to make any payment so you have an automatic receipt of it.
• Insist on speaking with the property owner before signing a contract or making a payment if someone says they’re representing the owner.
• If someone claims to be a real estate agent, ask to see their license and take a picture of it so you can confirm the information online through your state’s division of real estate licensing.

And finally, you might want to steer clear of Facebook for finding your new home: Rently’s report found that 88 percent of rental-fraud victims found the fraudulent listing there.

5. Bait-and-switch movers

How it works

Once you find a new home, you have to get all your stuff there. That’s where moving scams come into play: Maybe you were quoted an estimate for $4,000, but when the company shows up, they tell you it’s actually going to be $10,000. Maybe they packed up your stuff before demanding much more than they quoted initially, essentially holding your belongings for ransom. Or maybe they just took your deposit and didn’t even show up at all.

Unfortunately, moving scams are so common that two leading companies — Mayflower and United Van Lines — sponsor MoveRescue, an effort to help protect and provide help to consumers. According to the Better Business Bureau, consumers who reported moving scams to the BBB Scam Tracker in 2024 lost a median of $754.

How to protect yourself

Moving is expensive, and it can be tempting to simply go with the most affordable estimate. However, this is not something to shop for solely based on price. Ask the moving company for their license number, and see if any complaints have been lodged with the Federal Motor Carrier Safety Administration (a division of the U.S. Department of Transportation).

Check them out with the BBB, too. The BBB also recommends asking for quotes from three different companies; if a company gives you a quote over the phone, it says, that’s a red flag. Lastly, avoid paying a large chunk of money in advance. While a small deposit is normal to reserve the movers, reputable companies will not require full payment until the job is actually completed.

How to report real estate scams

Many real estate scam victims are too embarrassed to file complaints, making it harder to catch the scammers, Opperman says. If you believe you’re being targeted, or already have been, it’s important to take steps to notify the proper authorities:

• The best place to start is with the FTC. When you file a report with the agency online, it’s entered into a database that reaches local, state and federal law enforcement agencies.
• You can also file a complaint with the BBB’s Scam Tracker, which will help notify others about potential fraud activities.
• For a better chance at connecting with an individual to hear your story, consider contacting your state’s consumer protection agency as well.

If you have already fallen victim to a scam, you will likely need to do more than simply file a complaint — particularly if you’ve handed over any private information. IdentityTheft.gov is the FTC’s online portal for anyone who is worried that a criminal is acting in their name.