BEWARE - You and Your Clients Are a Target For This Real Estate Scam

Originally posted to Real Estate, The Economy, and News on March 24, 2016

Cyber-criminals are finding new methods every day to steal personal and financial information. Their techniques range from phishing scams to buffer overflow techniques and brute-force password hacking. Banking institutions have found themselves under attack far more than usual in recent years, and have in turn begun to incorporate stronger security measures in an attempt to block hackers. As a result, many scammers/hackers have moved on to what they believe are "easier targets." focusing on normal people rather than financial institutions, Just last week, the Federal Trade Commission and the National Association of Realtors issued a warning to consumers that they must be hyper-vigilant in order to avoid recent phishing schemes that have been targeting closing costs on real estate transactions.

The National Association of Realtors, along with the Federal Trade Commission, issued their statement warning people to be on the look-out for a specific scheme targeting those involved in a real estate transaction. First, the hackers gain access to the email account of a customer, real estate agent, or escrow officer, and use the information to keep up-to-date on the transaction and determine the closing date. When they have figured out the closing date, the scammer sends an email that has been masked in such a way that they are able to impersonate the escrow company, title company, or real estate agent, telling the customer that the wiring instructions had a last-minute change. If the customer takes the bait, they send their funds to the scammer's account, which can be emptied in minutes.

Sepulveda Escrow utilizes encrypted and secure email when sending documents with sensitive and confidential information. In addition, documents can be returned via email through this secure portal. Sepulveda Escrow has also instituted new procedures to contact Clients directly to confirm details, rather than relying on email or contact through a third party. (Please see end of this blog for some helpful tips.)

It is imperative to know that cyber criminals don't always need to be able to break through firewalls or use high-tech software to get your personal information or access your computer's data. Quite often, hackers use more subtle tricks to gain access. Phishing schemes are one of the most common ways by which they trick potential targets. One example of phishing is when a hacker sends a mass email to a group of people and makes it look like the email comes from a bank or other online payment platform. The email requests that the recipient verify their login information by following a link. The link leads to a page that closely resembles the actual login page for the financial institution, but when the user inputs their login information, the hacker records the username and password, thereby enabling them to access the account and steal their money.

Another example of phishing is when a hacker contacts a target or a group of targets under the guise of an Official informing them that they have been the victim of a scam. They then tell the recipient that they can help them fix the damage, but first ask for certain sensitive information like Social Security number or bank information, to "verify" what data had been "stolen."  While you may look at this and think that the scheme is too obvious to be effective, statistics show that approximately 0.4% of recipients fall prey to such attacks. In other words, if a mass email is sent to 10,000 people, about 40 of them will have their information successfully stolen.

While phishing is historically the easiest and most effective method by which hackers are able to steal personal or financial information, there are several other methods. A buffer overflow attack, used by more sophisticated hackers, involves inputting many lines of code into an online form in order to overload the system and allow the hacker to steal data inputted by previous customers. A brute-force password hack involves a computer program that inputs all kinds of combinations of letters, numbers, and symbols, until the correct password has been found and the hacker has gained access to an email or other kind of online account.

Finally, hackers often package viruses or worms into free online software or as attachments to mass emails. Such viruses can enable the hacker to record keystrokes, thus giving them access to many of your passwords, or enable them to access built-in microphones or webcams on laptops. Simply opening such an email or downloading an infected attachment can lead to a virus being installed on your computer or mobile device. Fortunately, anti-virus software can often help to detect and remove these viruses, but hackers are constantly finding new ways to avoid detection by your anti-virus program. The best way to avoid getting such viruses is to be careful when downloading anything, and to avoid opening any emails that seem suspicious or come from unknown or unreliable sources.

Here are some tips to help you avoid being affected by similar scams. First and foremost, if something doesn't look right or feels even a little bit suspicious, don't hesitate to double-check it. Don't rely too much on emails. Instead, pick up the phone and call your escrow officer or realtor to make sure that everything you have received is correct. Don't open email attachments you aren't expecting. Additionally, you shouldn't trust financial information that has been sent via email, nor should you send any of your own financial information via email, because it usually isn't secure. In general, wiring instructions are sent by fax or encrypted email message. When inputting personal information on a website, check the address for "https," of which the "s" stands for secure, meaning that your information will be better protected.

Be very careful when opening attachments or downloading anything from an email, no matter who sent it to you. Just because you recognize the email address, doesn't mean that the message actually came from the person you associate with that email address. It's possible that a scammer could have hacked a friend's email, or could have disguised their email to appear as if the message came from a friend's email address. Proceed with caution. Being aware and cautious can save you a lot of hassle in the long run. 

Biggest Tip: Following up on the phone after sending an email may seem burdensome, but we at Sepulveda Escrow find that it is always worthwhile to go the extra mile to avoid financial losses and potential lawsuits.

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Find out more about us at www.sepulvedaescrow.net. Any Questions? Contact our Escrow Expert! Sepulveda Escrow Corporation (818) 838-1831. Follow our company on Facebook, Twitter, LinkedIn, and Google+.

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The New Standard Practice: Our Latest Adventure

So here I am writing a post in my Blog called Escrow Experts, thinking that in this new Lending environment, I am anything but an expert. Learning as I go along and putting into action that which I learned in theory these last many months. The nice thing is that I am amongst good company. Throughout the nation, my peers, all respected professionals, are in the same proverbial “boat”.

As a quick reminder, as of October 3, 2015, we will no longer use the HUD1 Closing Settlement Statement, which has been phased out in exchange for the new Closing Disclosure.

There will be so much more liability on the lenders' shoulders, that the lenders will be issuing the Closing Disclosure based on an accumulation of fees provided to their office by the Settlement Provider (Escrow Holder). Consequently, the situation is now such that all fees as provided to the Lender must be actual, with little to no room for inflated Estimates as we have provided in the past. This creates quite a challenge, as in Escrow, we never really know what will be required of our office until the very end.

Consequently, effective October 3, 2015, Sepulveda Escrow Corporation has a new fee schedule, whereupon our office has done our best to keep our fees as close and reasonable as our previous schedule of fees, with the exception of including a small increase for archive fees and cost of living.

I also want to take this opportunity to explain something of great importance. During the last several years, our office has put a new protocol in place due to the terms and conditions in the lenders Instructions, and which some of you may not be aware of. Lenders require the Escrow company to be fully responsible and liable for the actions of the notary public performing the signing and notarization of the Loan documents (most require a One Million Dollar Errors and Omissions Policy of Insurance). Due to this burden of liability, our office requires Buyers to sign their loan documents in our office, and during our hours of operation. Doing so protects the Buyer on an even higher level by avoiding the documents being handled by outside notaries, Agents or Mortgage Brokers. (In the event of extenuating circumstances, such as out of State Buyers, our office has in place a Nationwide Signing and Notary Company who we employ to accommodate the signing). Each and every Manager of a direct Lender with whom I have spoken agrees with this as a necessary practice, and as such Sepulveda Escrow adapted this as company protocol.

While signing in escrow during office hours may not be as convenient as signing in one’s home at any hour of the day or night, every Buyer benefits in countless ways coming into escrow. It is a great comfort to meet and know the very person responsible for conducting the closing transaction which applies their hard earned money into homeownership.

Here at Sepulveda Escrow Corporation, we consider these changes in our Industry a challenge; preferring to accept this as an exciting opportunity to learn and incorporate new procedures into our every-day routine. And with that let me wish each and every one of us the best of luck, whether you navigate through these new times as an Agent, Broker, Mortgage Broker, Lender, Seller, Buyer or Escrow Officer. CHEERS!

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Find out more about us at www.sepulvedaescrow.net. Any Questions? Contact our Escrow Expert! Sepulveda Escrow Corporation (818) 838-1831. Follow our company on Facebook, Twitter, LinkedIn, and Google+.

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Termite Inspection and the Sale of Your Condominium or Townhouse

8/24/14 - When selling your condominium or townhouse a termite inspection may be required. Often times necessary repairs which may appear on a termite report may in fact be the responsibility of the homeowners association, the cost of which you already contribute towards in the payment of your homeowners association dues.

In a condominium or townhome complex there are common areas and often shared walls with other homeowners. Specific to termite repairs, your dues pay towards necessary repairs to common areas and areas which are external to the home (outside walls), while your dues more often than not does not cover termite damage inside your unit. It is important to know that repairs disclosed on a termite report are not limited to termite infestation. You may find yourself needing to make repairs caused by water damage (dry rot), even if this may have been caused by a neighbor.

TIP. Contact your Homeowners Association or Management Company and ask for the name of the termite company the complex has used most recently. Ordering your termite report from this company will help to keep your costs down as they will charge the Homeowners Association for any necessary repairs external to your unit and limit your report to the inside walls of your unit only.

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Find out more about us at www.sepulvedaescrow.net. Any Questions? Contact our Escrow Expert! Sepulveda Escrow Corporation (818) 838-1831. Follow our company on Facebook, Twitter, LinkedIn, and Google+.

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