They LOST Everything! Buyer Regrets!

What's up everybody. I had the most stressful Thanksgiving a few months ago and not for the reasons you may think. I was sure my sellers were getting scammed and I had to wait from Wednesday until Monday before I could find out. And I'll tell you more about that in a minute. But first let's talk about Regan Bartlow's story. She and her husband lost everything in a matter of minutes. Check this out. After months of grueling house hunting, Regan Bartlow and her husband You could see the finish line. All we had to do was fire the money and then go sign the papers and then in a matter of minutes it all came crashing down. I wish I could say they were the only people who lost all their money and their dream, but they're not. Days before the closing, she got an email that looked like every other email she'd received from her title company. Saying congratulations, we'll be ready to close on Wednesday and all you have to do is go ahead and wire your funds and that way all you have to do is come in and sign. It made perfect sense. This is a normal part of the transaction. Most buyers don't wait until the day of closing to wire the money. Regan followed the wiring instructions, but on the day of closing got a terrifying call from her realtor. You haven't been talking to the title lawyer and at that point my whole world fell apart because I had already wired all the down payment money for our house and it was about $255,000 and so our nest egg, our savings, everything at that moment was gone. $250,000. Can you imagine how long it took to save all that money, find your dream home, get excited to move in, start planning your future only to find out it's all gone and there is nothing you can do about it. This is an example of one of the biggest scams out there. Hackers break into title companies emails and real estate agents emails and they change the wiring instructions. Everything looks official and a lot of people are falling for it. Sgregor249 wrote on Reddit that they had recently bought a house. Prior to the day of closing on the house, they emailed their attorneys paralegal asking for the closing cost amount so they could go get a cashier's check. The paralegal emailed them back saying that they prefer a wire and attached a PDF with the bank's wiring instructions. The name on the account of the bank was their attorney's firm's name. The following day they went into the attorney's office to close and the attorney said they hadn't received the wire yet. They eventually showed the attorney where they had wired the funds and they said that's not the correct bank. The attorney then very quickly realized this was wire transfer fraud. A hacker gained control of the paralegal's email address and directed them to wire funds to a different account. This gets even more granular. They write that the hackers purchased a domain name one character off from the buyer's works domain name and made an email impersonating the buyer. The hacker somehow injected the new email into the middle of the email chain on the paralegal's computer and stalled her from further communicating with the buyer. So not only did the hacker fool the buyer but also the paralegal. Because of the double fraud in this case, the attorney's insurance company ended up covering the lost funds and the buyer was able to close on the house 15 days after the original date. They are really lucky because this usually ends really badly. There is an easy way to avoid this scam. Just never ever take wiring instructions from an email unless it's through a secure portal. But even then to be honest I would call the title company to confirm the wiring instructions before I would send your money. So back to my awful five days and I gotta tell you this is probably the worst five days I have ever had in my real estate career and I've been doing this almost 22 years. I just had a transaction recently where I was a listing agent. I represented the seller. We were selling it privately and it was an estate. Since I've been in the business a while and yes I am that old, I have investors reach out to me all the time to see if I have any off-market listings. It just so happened when one of these investors reached out to me I had just signed this listing. My sellers wanted to sell it privately and they wanted a quick close. It was a really good flip opportunity so I told these investors about it. They sent me an email with their terms and asked me to write it up and they would sign it. It was cash, two and a half week close, taking the house as is with a quick three day yes or no inspection. Meaning they could inspect the house. They couldn't ask for anything. They would say yes or no on whether they wanted to move forward. So I wrote it up. I did ask for proof of funds which we always do for cash. Meaning they need to show me where is the money coming from to buy this house. The buyer sent me a screenshot of a bank account with their name on it. Now this investor is an LLC but the bank account had the name of the LLC on it and it had about three times more money than they needed to buy this particular house. I did as much due diligence as I could on these buyers and I presented the offer to the sellers. The buyers did insist on using their preferred title company. So once again I looked up the title company. I never used them before. They're legit so I was fine with it. So my sellers decided to accept their offer and then the buyers did deposit their EMD or their earnest money deposit which was only six thousand dollars but they did with the title company and we moved on to the inspection. They did their inspection. When I say inspection I'm putting it in quotes because it wasn't really an inspection. They brought their contractors in, got all their estimates to make sure the numbers worked for their flip. After three days the buyers told me they are moving forward with the transaction and we head straight to closing. Like I told you earlier closing was set for Wednesday the day before Thanksgiving. So I told my sellers the buyers are moving forward. So the sellers, remember this is an estate this was their mom's house, started clearing out the house and just decided that hopefully this part of the grieving process will be behind them really soon. The Friday before closing I asked the buyers to wire the money on Monday since we're heading into a holiday week. They said everything's fine. They do this all the time. Stop worrying. The money will be there Wednesday. I started getting nervous but I had nothing to go on. So far everything had gone smoothly. So Wednesday comes. I go with the sellers at 9 a.m to sign the closing papers. All went smoothly. They're excited. They're ready to move on. Have Thanksgiving. Like I said move on with the grieving process. The buyers sign around noon. Not with me. They sign remotely through the title company. The money is still not there. I'm texting the title company. I'm calling the title company. I'm emailing them. Where's the money? I am definitely starting to get super anxious and worried. Started catching them in some inconsistencies. The buyers said because they were texting me back. They didn't disappear. The buyer said we went to the bank. The money's been sent. Then the title company told me the buyers told us they're going to the bank in an hour. So I was like what's going on here? This went on all day. At 4 30 p.m Wednesday the day before Thanksgiving the buyer says he's at the bank and the money's been wired. I asked the title company and they tell me there's no evidence of the wire. Now it's after five. There is no money. It's a holiday. Thursday and Friday and Saturday and Sunday. Banks are closed. So we got to wait till Monday. I am completely freaking out. I'm trying to figure out the scam. Remember both parties have already signed the settlement closing statement and I have a copy of it. So I'm assuming the buyers also have a copy of it. Also you got to remember the buyers don't have a realtor. It's just me. It's a private sale. So it's not on the public MLS. In fact there is nothing public about this transaction at all. And the worst part about it which really fuels my anxiety. I've never met these buyers. When I call them they don't answer the phone. It's like a Wi-Fi number. I can leave a message and they'll call me back and they'll text me back. But I've never met them. It's an LLC. You can understand why I'm freaking out. The title company is legit. So I'm trying to rule out the different scams. Could the buyers be trying to sell this property over the weekend with the signed ALTA, the signed closing statement. But then the title company would have to be in on it. So I don't think so. So what's the scam here? I fill my sellers in on what I've been told. The money has been wired at 430 on Wednesday but it won't land until Monday. So we're going to be closing on Monday. But I got to tell you between you and me I am super nervous at this point. I can't talk to anyone until Monday. I literally can't do anything all weekend. I am so anxious. I can't sleep. I'm thinking of ways I can pay my poor sellers back their inheritance if they have been scammed. I am freaking out. I keep replaying everything in my mind. It's an LLC. I've never met them. It's cash. It's private. How could I possibly find these buyers if they disappear? By the way I'm just curious if you're watching this and you're another real estate agent or just an attorney or anybody. Can you think of a possible scam at this point? Because I was going insane. So Monday comes and at 9am I'm back at it again. I'm emailing. I'm texting. I'm calling. The title attorney is not taking my calls. I got to tell you it's really annoying. The only calming factor is that the buyer has not disappeared. They do text me back when I text them. Remember they never answer the phone. I think it's a Wi-Fi number. But they do text me back. So that does calm me down a little bit. I've now called my own title attorney and filled him in. He remains calm until afternoon hits and then he says to me I think we may have a problem. He offers to call the title company himself like between colleagues to kind of figure out what's going on with this transaction. So I'm going to jump ahead because I don't want to drag you through my anxiety. I think you get the point. I don't want to lead you down a road that you're expecting one result and there's another. But the money did come eventually later that afternoon. Not on Wednesday like they were supposed to but it did come late Monday afternoon and we did close on the house. Either I got very very lucky or I am very sensitive to possible scams. But this just did not feel right and I am still unsure if the buyer would have really closed if I wasn't such a pain. The crazy thing is that after we closed around 5 30 that same day I get a text from the buyer. By the way Karen I just want to clear the air a little more. Are we okay to progress our business relationship here? I had a great experience with you and I've worked pretty hard to make sure it was smooth for you as well during the transaction and above. Happy to work some more together? I'll read you my response. Honestly these last five days have been super stressful. The lack of concern for the closing date is something I've never experienced before. I suggested you wire the money on Monday to avoid any delays. You refused. Since you both point out many times that you do this all the time you should know better than to wait until the last minute to wire funds. Especially right before a holiday. I'm sorry but I cannot work with people who don't respect the contract dates. It's way too stressful and I'm not okay with delays that could have been avoided. Good luck with everything. They texted me two more times after that and I didn't respond. There really isn't any need. To be honest I think they lied to me about wiring the money on Wednesday at 4 30 p.m. because I asked for proof of the wire and they never showed it to me. I can't prove they lied at this point and it really doesn't matter but I will never put myself through that again. I will only work with investors that I know moving forward. It's just not worth the risk. If you've been scammed or if you can think of a way that my sellers could have been scammed in this situation please put it in the comments because I think we can all learn from all this stuff that's going on out there and there is a lot of it going on. I did a video recently on how homebuyer remorse is exploding and how buying your first home can turn into a nightmare. It's a good one so definitely check it out next and I give you some possible solutions on how not to become house poor. Thanks for watching. I do appreciate it. Bye.