Homebuyers in NJ absolutely need to know about this scary study

When you buy a home, it feels like part interrogation, part mental boot camp, and part lab specimen under a microscope. You remember it? Having to gather and provide what feels like hundreds of documents and so much personal information?

It’s daunting, it’s stressful, and every time I’ve been through it, I tell myself I never want to move again just to avoid the nightmare.

What’s that? You’ve never been through it? Oh, well, here’s something else you need to know, then, and you’re not going to like it.

Warning

A study just came out by Underwood Law Firm in which they analyzed FBI data to reveal which states are hit hardest by real estate scams and specifically, where victims lose the most money on average.

It is rampant in New Jersey.

Sadly, and let this be a dire warning, the Garden State ranks in the top 10. According to a press release, the report shows the average New Jersey real estate scam victim loses $24,767 and it puts us at No. 8 in the nation.

SEE ALSO: What you now need to earn to buy a home in NJ is obscene

How scammers work

“According to the American Land Title Association, one in three homebuyers is now at risk of encountering fraud attempts during a property purchase. Scammers often hack into legitimate real estate communications, mimicking email threads from agents or lenders to trick victims into wiring money to fraudulent accounts,” warns Elijah Underwood, a real estate investor and lawyer.

“Real estate fraud has evolved far beyond forged paper deeds," the firm's study said. "The FBI warns that business email compromise (BEC) and wire transfer scams targeting homebuyers and escrow agents are now among the most expensive forms of cybercrime. In 2023 alone, BEC schemes linked to real estate transactions caused more than $400 million in reported losses nationwide.”

Once a wire transfer is completed, recovering funds can be extremely difficult, especially across state or international borders. If you’re the victim of this you’ll have very little recourse.

What can you do?

The FBI urges homebuyers to verify all financial instructions by calling trusted contacts directly before sending any money. Double check. Hell, triple check. Remember so many of these scams work by infiltrating a legitimate real estate transaction already underway. So they know how to make it look real.

Don’t worry about being a pain in the butt by calling the contact directly, making sure they really are the ones who sent those instructions. Home ownership is worth it, but so is protecting yourself during the process.