By Lisa A. Tyler
National Escrow Administrator
Absentee owner scams have become a real estate epidemic! Absentee owners of real property are the target of criminals who pose as the owner offering the home. These imposters sell the property and abscond with the sale proceeds. The real property owner has no idea their property is the subject of a real estate transaction.
The latest twist on the scam involves the criminal using the property as collateral for a new loan and fleeing with the loan proceeds, attempting to strip any equity the true owner may have in the property. Settlement agents can prevent this crime from happening by following the three steps found in the “HOW to rescue $1 million” article.
In certain areas of the country, it is not uncommon for the buyer and seller to retain representation or separate counsel to assist with their side of a sale transaction. The buyer signs their closing documents with their title company and the seller with their own counsel or attorney-owned title company.
The buyer’s title company may have limited or no direct communication with the seller. Instead, the attorney and title company (or two title companies) communicate with each other to work towards the same goal: consummation of the transaction.
Generally, the buyer’s title company receives the new loan funds. That title company coordinates the recording of the deed and deed of trust or mortgage. The buyer’s title company then sends the proceeds and funds to cover the seller’s costs to the seller’s attorney or title company.
Recently one of our offices, working as the title settlement agent for the transaction, identified several red flags surrounding the seller — who was represented by a law firm. Read “ATTORNEY closing” for more information.
We are continuing with article ten in our twelve-part series on cash reporting. After “cash” has been received and the required information about the remitter of the “cash” is gathered, be sure to complete Form 8300. Read “COMPLETING form 8300” for all the details.