Question: I am buying a new home, and the closing company told me that I could not use a certified check for the money I'm paying at closing. It wants me to wire it and confirm the wiring instructions before I send the money. I don't see why I need to jump through these hoops. What's going on? – Vince
Answer: Your closing agent is trying to protect you. The scary truth is that fraud is running wild out there, and the criminals are always coming up with more sophisticated ways to rip you off.
In the latest scam, fraudsters will hack into your real estate or title agent's unsecured email account by either guessing the simple password or buying it from the black market. They will sit back and watch the emails until you are a few days from closing. Then they will send a fake email that looks just like it was sent from the person you trust. However, it will contain false wiring instructions that have you send your funds to their account and not the closing agent's. To make matters worse, fraudulent cashier's checks are so rampant that I don't know of a single closing agent that will accept them anymore.
Fortunately, this is a relatively easy scam to avoid. Visit your closing company and get the wiring instructions in person. If this is not feasible, insist on using a closing company that uses secure, encrypted email. While it can be a hassle to deal with encrypted email, it is your best protection from this increasingly common scam. Not only is your closing company dealing with your money, it also is dealing with your most personal information. You want to make sure that when the company emails this, and stores it on its servers, the company has appropriate information security measures in place. When in doubt, call and ask.
Finally, when you do get your final numbers, call your closing company and confirm that the wiring instructions you received are the correct ones. If you have never heard of your title company except by emails you received, confirm that the phone number you are calling is correct by cross-checking it on the internet.