Enough with the scams already

Plus — Money's first reader-submitted listing

͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌  August 19, 2023 • Issue #105 Happy Saturday! This week, we’re discussing a new scam affecting homeowners and mortgage lenders, plus a home with your own private beach.

A new mortgage scam is on the rise

Money; Getty Images There’s a new type of mortgage fraud gaining ground, and it’s netting scammers a lot more than chump change. The scheme targets mortgage payoffs, or the money you send your lender or servicer after you sell your home to take care of the remaining balance. Most people rely on profits from a home sale to pay off their lien, and those funds typically make a pit stop in an escrow account held by a title company until the sale closes. According to Housing Wire, fraudsters have figured out how to juke the system by pretending to be the lender/servicer the title company is supposed to send the money to. And no one is the wiser until the seller starts getting “late payment” notices on a mortgage they thought they’d paid off already. How big of a problem is this? During the first quarter of 2023, the fraud prevention firm CertifID says it prevented $1.9 million in attempted fraudulent mortgage payoffs. In Q2, that number shot up to $12 million; a 532% increase in just three months. And these are just the ones that were caught. (The average mortgage payoff, by the way, is over $230,000.) The ever-growing layer of third parties sticking their tendrils into the operation and maintenance of mortgages these days has allowed this scam to take off quickly. Lenders frequently sell off the loans in their stable — or the servicing rights to those loans. They also constantly switch up the accounts they use to receive escrow funds. Worse yet, title companies don’t communicate that often with the lenders/servicers they send giant sums of (homeowner) money to, so it’s pretty easy for scammers to dupe them with a fake email address, fax number and bank account info. So how can this fraud be nipped in the bud? Mortgage servicers and title companies have to be aware — and vigilant — of the problem. Otherwise, somebody (usually the lender) will get duped out of lots of cash.

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Listing of the week

Geoffrey Lardiere A home made for nature (and water) lovers This week’s listing comes courtesy of a Money Moves reader, who is moving closer to family and reluctantly selling this Wisconsin home. Located on three-quarters of an acre in Door County, the house features 9-foot ceilings and a multitude of windows with beautiful lakefront views (starring some pretty spectacular sunsets). But while the home's inside is warm and cozy, the outside is the real draw. You’ll have access to Lake Michigan (the backyard is literally a private beach), plus a butterfly garden and a firepit to keep you warm on chilly nights — this is Wisconsin, after all. The home, listed by Shorewest Realtors, has 3 bedrooms, 1.5 baths and a 112-foot pier — and it can be yours for a breezy $1.1 million. Dan Eggert

’Til next time, P.S. Have you seen a unique listing on social media I should feature in this newsletter? Or have a question about housing or mortgages you desperately want answered? Let me know on Twitter at @LeslieLCook or via email at leslie@money.com. P.P.S. Have a friend who loves real estate or is looking for a home of their own? Please forward them this email or send them to the Money Moves subscription page.

Money’s Essential Home Buying Resources: Summer 2023

On the hunt? Check out Money’s Mortgage Calculator, list of The Best Mortgage Lenders and look at the latest mortgage rates. Thinking of refinancing? Our list of The Best Mortgage Refinance CompaniesMortgage Refinance Calculator or these refi tips. Key question: How much house can I afford?

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