Watch out for these mortgage scams
Your first step of protection? Avoid scams by always using a trusted mortgage broker
Even with increased online security and tight rules and regulations, so many scams are going around. We live in a world where buying or selling a property is possible without meeting face-to-face with your conveyancer, mortgage broker, estate agent, surveyor, or even buyer/seller.
We look at some of the top ways scammers will try to steal your information and money. Remember, we are always available for a phone call if you are nervous and going through us means we can screen for scams for you.
- Pretending to be buyers and/or sellers. They will gather information about the property and transfer it to themselves with fraudulent documents. They may try to offload the property quickly when they act as sellers using information freely available on the Land Registry website. Probably at a reduced rate to sell quickly. Remember: even if a person has access to a property to show you around. They may just be house-sitting or renting (with the intent to commit fraud).
- Pretending to be a landlord or rental agent. Many people renting in the UK are used to an online process. So, fraudsters may present properties online — often with fake photographs. They then pressure interested parties to sign into a deposit before they disappear. They may even have access to the property. But this doesn’t mean they have the legal right to rent it!
- Pretending to be a lender. They pretend to be lenders who claim they can renegotiate their current debt or mortgage if they are sent payments.
- Mortgage fraud. Mortgage fraud is used by people who borrowed too much money to mislead lenders or house buyers. Inflating their income to secure loans. However, it can also happen when groups of criminals mislead lenders. Can contain corrupt solicitors, brokers and valuers.
- Inflated sale price. Fraudsters will sell properties (sometimes holiday homes) with exaggerated projections of its rental potential. Often an attempt to scam prospective landlords.
- Fraudsters pretending to be conveyancers. Through hacking or careful manipulation of email addresses or genuine-looking letterheads. Then, ask their clients to transfer money to them. This request often happens just before the weekend. Putting pressure on clients to pay without proper verification. This allows fraudsters to stay under the radar until the next week. And get away with the money before they are discovered.
It’s thought that this ‘home hijacking’ (also known as ‘Friday afternoon fraud’) is the most common legal-related cybercrime.
What you can do to avoid being a fraud victim.
Buyers
- Avoid properties that you see online where you are not allowed to see the property in person. Or if appointments are constantly being changed or delayed.
- Don’t give in to demanding phone calls, emails or letters that pressure you into quick decisions. Especially when they are related to paying money. Or ask you for personal details.
- Don’t transfer money without calling and verifying bank details with your conveyancer. And be especially suspicious of such requests on a Friday afternoon.
- Be wary of property investment seminars and training programmes that are ‘invite only’ and make hefty promises.
- Familiarise yourself with the property’s tenure via the Land Registry.
- Don’t be afraid to ask your seller plenty of questions – they will have no problem answering.
- If you have concerns, confirm what checks your conveyancer or property solicitor has made on the property and the seller.
- Don’t engage with any lenders or mortgage brokers that haven’t been approved by the Financial Conduct Authority (FCA).
Sellers
- Be wary of buyers who come in with excellent offers. Especially if you have been struggling to sell. They may be scamming you to get personal and property details.
- Use a trusted letting agent if you are a landlord looking to rent.
- You can sign up for a ‘Property Alert’ from the Land Registry’s website. It will notify you of any applications or searches they receive regarding your property (or one of your properties). It can help you stay alert to any possible fraud. Especially if you don’t know the source of these searches or why they were made.
Tenants
- Only pay a deposit into a government-sanctioned deposit scheme. This is currently the Tenancy Deposit Scheme, Deposit Protection Service and MyDeposits in England and Wales.
- Don’t offer valuable items to a landlord as a deposit. They will not be protected. Landlords should not accept this. But a fraudulent landlord will likely have no problem accepting the item before vanishing with it.
- A tenant’s holding deposit is not protected until they become a tenant. You shouldn’t pay a holding deposit to anyone other than a trusted letting agent or landlord.
If you believe you’ve fallen for a scam. Contact your bank immediately at a number you know to be correct. Such as the one on your statement, their website, or the back of your debit or credit card.
Report it to Action Fraud on 0300 123 2040 or via actionfraud.police.uk. If you are in Scotland, please report to Police Scotland directly by calling 101 or Advice Direct Scotland on 0808 164 6000.
Call us on – 01494 358835
Sources: https://www.foys.co.uk/news/property/property-fraud-what-you-need-to-know/ https://www.takefive-stopfraud.org.uk/conveyancing-scams/