How to Avoid Wire Fraud in a Real Estate Closing

Real estate wire fraud is increasing. According to current FBI data, real estate scams now touch one in four homebuyers

It’s clear the problem is massive with nearly one in four consumers targeted and one in 20 becoming victims resulting in $500,000,000 annually in real estate monetary theft. FundingShield noted that nearly 47% of transactions showed fraud risk in Q1 2025.
 
Why has this become such a lucrative field for criminals? In short, technology. Hackers are using sophisticated A1 and spoofing to target high value real estate transactions.

How AI & Spoofing Works

Scammers are increasingly using artificial intelligence, deepfakes, and voice spoofing to create realistic fake emails and accounts which trick victims into sending large amounts of closing funds.
 
Hackers do their work very carefully. They take on the identity of the title agent using a similar email address, signature, and logo the client has seen in other legitimate correspondence.
 
Then they send the buyer instructions to wire funds to a fraudulent account. For sellers, hackers take on the seller’s identity by hacking their email account to divert the seller’s proceeds to a fraudulent account.
 
First time homebuyers are the most vulnerable to this terrible scam.

Here’s How to Protect Your Money Before Closing

• Be vigilant—Confirm wiring instructions by phone. Do not email.
• Be suspicious—Title companies like Lilly Title & Settlement do not change wiring instructions and payment info by email.
• Confirm everything—Ask your bank to confirm the name on the account before wiring your money.
• Verify immediately—Within 4-8 hours call the title and settlement company to confirm the money was received.

 
Take every precaution possible to protect your money!

FAQs

How does a title and settlement company protect against wire fraud?

• At Lilly Title & Settlement, we establish a phone procedure for calling us using a confirmed phone number. This verifies the legitimacy of the wire instructions received by fax or email.

 

• We use encrypted emails with our wire transfer instructions.

 

• We verify the email that the wire transfer instructions were received. Additionally, we verify the information and instructions prior to sending funds on your behalf. Get more wire fraud prevention tips from this post.
  

Are wire instructions ever sent by email?

Some communication with your title and settlement companies may occur by email. However, you should never rely solely on emailed wire instructions. A reputable company like Lilly Title & Settlement will encourage verbal confirmation to prevent fraud.

When does the seller receive their proceeds?

Typically, sellers receive proceeds shortly after closing, once all documents are recorded and funds have fully cleared. Timing can vary based on lender requirements and local recording procedures.

Ready to close on your new home? Turn to the pros at Lilly Title & Settlement. We’re obsessed with legal details, so we close on time without stress on you!