Real Estate Scams: How to Spot Fraud & Fake Agents When Selling Your Home

You’ve listed your home. The offers are rolling in. Everything looks good… until suddenly something feels off. An email comes through with “urgent” wiring instructions. A “buyer” seems too eager, sending more money than you asked for. Or worse, you learn someone has filed paperwork at the county recorder’s office claiming they now own your house. This isn’t just bad luck – it’s modern real estate scams, and they’re on the rise.

According to the FBI’s Internet Crime Complaint Center (IC3) 2024 report, $173,586,820 million in losses from real estate fraud, a number that has been climbing each year. Wire transfers gone wrong, fake listings, and deed fraud are not rare accidents but increasingly common crimes. The Federal Trade Commission has also raised alarms, warning property owners to stay alert as scam artists exploit confusion in high-value property transactions.

When you’re selling your home, the stakes are enormous. One misstep can lead to devastating financial loss, reputational damage, and even the nightmare of losing your property on paper. We break down what real estate fraud is, the most common types of real estate scams you should be watching out for, how to spot scammers and fake real estate agents, and practical steps to protect yourself. By the end, you’ll be better equipped to guard your finances, your home, and your peace of mind.

What Is Real Estate Fraud?

Fraud in real estate simply means someone is using deceptive practices to trick you into handing over money or property you wouldn’t otherwise give. But in practice, it can take many shapes. However, the psychology of these scams is always the same. 

They lean heavily on urgency (“You need to wire this today or lose the deal”), secrecy (Reluctance to provide details or ID), and impersonation (pretending to be an agent, title company, or even your lender). Homeowner scams can also involve fake applications for mortgages, deposit scams disguised as “earnest money,” or even foreclosure relief schemes where fraudsters promise to save your home in exchange for signing over your property deeds. 

The goal is always the same: take advantage of confusion and pressure to steal money, property, or both.

Why Home Sellers Are Attractive Targets

Selling a home is an emotional, complex, and high-stakes process. Scammers know this and take full advantage. When there’s confusion, urgency, and money on the line, scam artists see opportunity.

• Big money is on the table. Real estate transactions often involve six-figure sums, making them irresistible to scammers.

• Pressure is high. Selling a home often comes with urgency - homeowners want quick closings, especially if they’re downsizing, relocating, or facing foreclosure relief options. In these situations, sellers are more likely to act quickly and overlook small warning signs.

• Remote selling is common. Absentee property owners, vacant houses, and out-of-state heirs are prime targets because scammers can act unnoticed, often using public records to pull information about property transactions.

• Older adults are particularly vulnerable. Seniors are disproportionately hit with financial scams that involve identity theft,  document forgery, foreclosure rescue scams, and deed fraud schemes. Alarmingly, the 2024 IC3 report also revealed that the 50-59 age group lost the most to real estate scams, totaling $22,466,504, with losses decreasing in correlation to younger age groups.

Types of Real Estate Fraud: The Most Common Real Estate Scams Sellers Face

With significant financial stakes involved, understanding the most common types of real estate fraud is crucial for protecting your assets and interests. From forged documents to numerous deceptive practices by supposed buyers, the modern-day spectrum of scams targeting sellers is broad and sophisticated.

This overview sheds light on the various tactics employed by real estate scammers, equipping sellers with the knowledge necessary to safeguard their transactions.

1. Wire Fraud at Closing

Wire fraud is the heavyweight champion of real estate scams – the #1 threat. Criminals hack into email accounts belonging to title companies, real estate professionals, or even sellers. They monitor conversations until closing day, then send a perfectly timed fake message with “updated wiring instructions.” Sellers or buyers, caught up in the excitement of closing, often comply. 

Once the money is wired, it disappears into overseas accounts that are nearly impossible to trace. The FBI identified real estate wire fraud as one of the fastest-growing and most financially damaging internet crimes in its Congressional Report, with individual losses often reaching hundreds of thousands of dollars. The biggest red flag is any last-minute change to wiring instructions, especially if it comes via email. 

Slight misspellings in the sender’s address, unusual urgency, or requests not to confirm with anyone else are also strong warning signs. The only way to protect yourself is to slow down. Always verify wiring instructions with your title or escrow officer over the phone using a number you’ve confirmed independently. Never rely on email alone, and never wire money without double-checking.

2. Title / Deed Fraud

Title fraud, also called deed fraud, is terrifying because it can make it look like you don’t own your home anymore. Here, criminals forge signatures or file fraudulent property deeds (like quitclaim deeds) with the county. On paper, ownership transfers to them. They can then borrow against the property or try to sell it. Victims often first realize something is wrong when they receive mail from mortgage companies they’ve never heard of, or when they find out that the title to their home has changed hands in public records.

Preventing title and deed scams requires vigilance. Regularly check county property records to confirm your ownership. Sign up for property deed monitoring if your county offers it. Keep all property documents secure and avoid sharing sensitive information unnecessarily. Title insurance is another layer of protection, covering certain risks tied to fraudulent claims.

3. Fake Real Estate Agents and Brokers

One of the most common scams involves a fake real estate agent. Imposters create polished websites, print business cards, and present themselves as seasoned real estate professionals. Sometimes, they even use forged corporate resolutions or fake applications to pose as representatives of real organizations. For home sellers, the danger is clear: working with someone who isn’t licensed puts your property, finances, and personal information at risk.

These types of scam artists might demand upfront fees, pressure you into questionable deals, or insist on payments outside of escrow. Red flags include the absence of a license number, refusal to provide ID, no legitimate office address, or requests to bypass normal safeguards. The solution? Verify everything. 

Use your state real estate commission’s website to check if the person’s license is active. Confirm broker affiliations, ask for references, and don’t hesitate to walk away if something feels off.

4. Phantom Property Listings & Rental Scams

Phantom listings are fake property listings, usually targeting vacant land or homes that the scammer doesn’t own. They post ads online (posing as landlords or homeowners), often at below-market prices, and lure buyers with promises of quick deals and prices too good to be true. They then demand payments up front from unsuspecting renters or buyers, who later show up at the property expecting to move in. 

Once the victim pays a security deposit, the scammer vanishes. This can cause stress for both parties deceived – reputational damage to sellers, and waste of buyers' or renters' money. For homeowners, the best prevention is to monitor your property online. Set up Google Alerts with your address. If you see your home listed anywhere you didn’t authorize, report it immediately to law enforcement. 

If you're someone renting or buying a property, always confirm ownership via the county recorder and never hand over money without proof and an in-person assessment.

5.  Fake Buyers & Overpayment Scams

Real estate scammers also target sellers directly by posing as buyers. The most common variation is the overpayment scam: the buyer sends more money than agreed, then requests a refund of the “extra.” Later, their original payment bounces, leaving you with nothing. Legitimate buyers don’t insist on bypassing escrow, direct payments, or using strange payment methods. The safest approach is to insist that all funds move through verified title or escrow companies.

6. Foreclosure Relief / "Rescue" Scams

Foreclosure rescue scams prey on homeowners in financial distress. These fraudsters promise to “save” your home for a fee, or claim they can work directly with your lender. Some take it further, asking you to sign a quitclaim deed transferring ownership to them “temporarily.” These are classic deceptive practices.

No legitimate organization will ask for upfront fees or deed transfers in exchange for help. If you’re struggling, consult HUD-approved housing counselors or seek legal guidance. Never sign property deeds without attorney review.

Notable Mentions: Other Types of Real Estate Scams to Look Out for

Scammers operating in the real estate world are getting bolder and more creative by the day. From slick pitches to subtle cons, they’re constantly finding new ways to exploit homeowners, buyers, and sellers. Beyond the most common and well-known schemes, there are other types of real estate fraud to keep in mind that can cost big if they’re not careful.

• Home Improvement Scams – Unsolicited contractors use high-pressure tactics and take large upfront payments, then disappear, or perform shoddy, overpriced work that leaves homeowners out of money and/or worse off than before.

• Home Inspection Scams – Individuals posing as qualified inspectors to either gain entry to homes for theft, or to provide incomplete or fraudulent inspections to conceal significant defects or exaggerate minor issues, unfairly steering deals or setting up costly repairs down the line.

• Loan Flipping ("Bait and Switch") Scams – Predatory lenders convince homeowners to refinance by advertising attractive loan terms or rates, then changing them at the last minute or repeatedly refinancing a borrower's mortgage, each time stacking on fees and higher payments, eventually draining the borrower's equity and straining finances.

• Mortgage Fraud – Scammers falsify information on applications or misrepresent loan terms, trapping borrowers in unaffordable mortgages or inflating property values for profit.

How to Verify a Real Estate Agent or Listing

Many scams fall apart under scrutiny. That’s why verifying an agent or a listing is so important. Here’s a checklist:

• Start by checking the license. Every legitimate agent has one, and you can confirm it through your state licensing board’s database.

• Look up the agent’s broker affiliation and National Association of Realtors (NAR) membership.

• Cross-check listings on MLS. Don’t just rely on online reviews — scammers know how to game those.

• Validate office address and phone number. Request to meet in person and ask for ID.

• Refuse payments outside escrow.

A real professional won’t resist this scrutiny. If someone is pressuring you to sign odd paperwork, is reluctant to provide ID or license details (or hands you fake applications with mismatched info), or insists on handling money outside escrow, those are clear red flags. Scammers thrive on blind trust without verification – don’t give it to them.

Protecting Yourself From Real Estate Scams

Preventing fraud in real estate comes down to three key phases: before, during, and after your sale.

Before listing, sign up for deed alert services offered in your county. Ensure you work only with reputable home buying companies or real estate professionals. Secure your digital accounts with strong passwords and two-factor authentication – many scams start with hacked emails.

During the transaction, be extra cautious. Confirm all wire transfers over the phone using a verified number, not the one in an email. Stick to escrow and title companies vetted by your state bar or Better Business Bureau. Keep detailed records of all communications, in case you need them later for legal disputes.

After the sale, don’t assume the danger is over. Keep checking county property records to make sure no fraudulent filings appear. If you suspect identity theft, consider freezing your credit.

This layered approach protects you against both immediate and long-term threats.

Fell Victim to a Real Estate Fraud? What to Do If You Suspect You’re Being Scammed

If something feels wrong, act immediately. Don’t wait – time is of the essence here.

1. Stop any pending payments and contact your bank immediately to freeze transactions.

2. Contact your escrow or title company to alert them.

3. Report the fraud to the FBI’s IC3, the Federal Trade Commission, and your local law enforcement. You can file online using the designated official FTC resource.

4. It’s also important to notify your state real estate commission if the scam involved a fake agent or fraudulent property transactions. Provide as much documentation as possible — emails, bank account numbers, public records, even text messages.

Template bullets for reports:

• Transaction details (dates, amounts, parties).

• Copies of suspicious emails/texts.

• Bank account numbers used.

• Any public records showing fraudulent filings.

Call an attorney if:

• A fraudulent deed has been recorded.

• You’ve lost funds.

• Identity theft is suspected.

You may need to pursue legal remedies such as quiet title actions, deed cancellation, or restitution suits. These cases are complex and time-sensitive, so don’t delay.

Spot Real Estate Scams Early, Sell Your Property Safely to Reputable Buyers

Real estate scammers thrive on secrecy, urgency, and confusion. The best defense against real estate fraud is slowing down, double-checking every step, and refusing to cut corners. If you need to sell your house quickly, you’re even more vulnerable – and that’s when scam artists strike hardest. Trusted, local cash home buyers like SleeveUp Homes can provide a safe, straightforward alternative even if you’re in a rush.

We’ve spent years helping Southern California homeowners sell their houses fast and as-is, without the pressure, gimmicks, or risks of falling prey to homeowner scams. We make fair, all-cash offers after a simple walk-through assessment of your property, and we let you choose the closing date — whether it’s in as little as 7 days or longer if you need more time. There are no hidden fees, no closing costs, and no stress. 

Request a free, no-obligation offer for your home, whether it’s in foreclosure, encumbered by debt, distressed, or rental, and if you like what you hear, sell directly to a reputable buyer like SleeveUp Homes. Protect your property and your peace of mind.

Author:

Cesar Gomez , Broker /

Cesar has worked as a real estate agent and broker in the southern California region since 2013.

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