November 3, 2025

issued from and by the DRE - Department of Real Estate

DRE Urges California Consumers to Be Aware of Real Estate and Mortgage Crimes

With its high property values and active real estate market, CA is particularly vulnerable to several types of real estate and mortgage-related crimes.

With that, the Department of Real Estate (DRE) urges Californians to be cautious and educated on the different types of real estate and mortgage crimes it sees in the real estate industry.

Many of these crimes prey on the complex nature of the home-buying process, making them difficult for the average consumer to recognize.

Below are the most common crimes that could present a threat to CA consumers, along with tips for avoidance.

It is important to note that even well-meaning individuals who are unaware of the full consequences may find themselves facing legal scrutiny if they participate in or enable fraudulent activity.

1. Mortgage Fraud

Mortgage fraud often involves fabricating financial information, such as inflating income or misrepresenting assets, to qualify for a mortgage that the borrower cannot afford.

In CA, with its high property values and competitive market, individuals might be tempted to misrepresent their finances or the purpose of the loan to secure loans.

This can lead to financial ruin when the borrower defaults on the loan, but it also harms the lender and contributes to the larger issue of housing market instability.

Tips for Avoiding Mortgage Fraud:

Always disclose your true financial situation to lenders.

Be cautious of mortgage brokers or agents pushing you into loans that seem too good to be true.

Never sign any documents you do not fully understand or that contain unclear terms.

Work with reputable financial institutions and real estate agents and verify their credentials.

2. Business Email Compromise (BEC) in Real Estate

This type of fraud is becoming increasingly sophisticated.

Criminals hack into email accounts of real estate professionals or escrow officers and impersonate them to trick homebuyers into transferring large sums of money to fraudulent accounts.

CA's tech-savvy real estate market is particularly susceptible, with high-value transactions at risk.

Tips for Avoiding BEC in Real Estate:

Always verify payment instructions with a phone call to the escrow officer or real estate agent—especially for wire transfers.

Be cautious if you receive unsolicited emails asking for changes to payment instructions.

Look out for unusual email addresses or slight changes in email domain names that appear legitimate at first glance.

Use multi-factor authentication (MFA) for any email accounts linked to real estate transactions.

3. Deed and Title Fraud

Deed and title fraud are a growing concern, particularly in CA’s more populated areas.

Scammers forge deeds and use fake identities to transfer ownership of properties.

Once the property is in the fraudster’s name, they may sell it or take out a loan against the property, leaving the original owner unaware until it is too late.

Tips for Avoiding Deed and Title Fraud:

Regularly monitor your property records for unauthorized transfers or changes.

If your county recorder’s office has a deed notification program, sign up to receive notices.

If you receive any unusual or unsolicited documents, consult with a title company or attorney before taking any action.

Consider purchasing title insurance, especially for properties in high-risk areas.

If someone contacts you asking to transfer ownership of your property, verify their legitimacy.

4. Foreclosure Rescue Scams

Many homeowners facing financial difficulties may fall victim to foreclosure rescue scams.

Fraudsters pretend to be experts who can help prevent foreclosure, but their real goal is to steal fees upfront without providing any real assistance.

Tips for Avoiding Foreclosure Rescue Scams:

Never pay upfront fees for foreclosure help—legitimate programs will not ask for this.

Always check if the company offering help is HUD-approved or affiliated with legitimate government programs.

Seek assistance from a certified housing counselor before agreeing to any services.

Avoid deals that promise to immediately stop foreclosure or wipe out your debt.

5. Property Flipping Fraud

In property flipping fraud, scammers purchase distressed properties, make minimal repairs (or no repairs at all), and then sell the property at a drastically inflated price.

They may also manipulate appraisals to deceive the buyer about the true value of the property.

Tips for Avoiding Property Flipping Fraud:

Always hire a reputable real estate professional or inspector to help evaluate the property and transaction.

Be skeptical if the price seems too good to be true—especially in markets where home prices are generally high.

Ensure the property appraisal is done by an independent third party and not someone with a financial stake in the sale.

Ask for detailed information about the history of the property’s permits, repairs, and improvements. Many local building departments even provide access to permit history online.

6. Equity Skimming

Equity skimming occurs when a fraudster convinces homeowners who are struggling with payments to transfer ownership of their property, often with the promise of saving their home.

Instead, the fraudster collects rent or mortgage payments from the homeowner and never pays off the original mortgage.

Tips for Avoiding Equity Skimming:

Never sign over the title of your home to anyone claiming they can help you avoid foreclosure.

Work only with reputable lenders, real estate agents, and housing counselors who don’t ask for ownership rights or power of attorney.

Read all documents carefully before signing and consult an attorney if anything seems unclear.

Be cautious of individuals offering to “rescue” you in exchange for quick decisions or immediate transfer of property.

7. Straw Buyer Schemes

Straw buyer schemes involve an unsuspecting consumer purchasing a home on behalf of someone else, often to hide the identity of the true buyer who may not qualify for the loan due to poor credit or other reasons.

This can result in the consumer, aka the straw buyer, being held liable for a loan they can't afford, leading to potential foreclosure, negative impacts to credit, and other risks.

Tips for Avoiding Straw Buyer Schemes:

Always verify the identity and financial standing of anyone you are dealing with in a real estate transaction.

Never agree to buy property on behalf of someone else without understanding the full risks and consequences.

Make sure all mortgage and loan paperwork reflects accurate information and fully discloses the true buyer.

Work with a reputable lender that follows all appropriate verification procedures.

8. Mortgage Elimination Scams

Fraudsters offering mortgage elimination scams will tell homeowners they can “eliminate” their mortgage debt through a legal loophole for a hefty fee.

These offers are completely false, and no such legal loophole exists.

Tips for Avoiding Mortgage Elimination Scams:

Be highly suspicious of anyone claiming they can cancel or eliminate your mortgage for a fee.

Always seek advice from a trusted financial advisor or housing counselor before paying for any mortgage “relief” services.

Report suspicious mortgage elimination services to state regulatory agencies or law enforcement, such as

DRE,

California Department of Financial Protection and Innovation,

or the

California Attorney General’s Office.

9. Elder Financial Exploitation in Real Estate

Scammers often target older adults with high-value properties, taking advantage of their trust to persuade them to sell or transfer their home under suspicious circumstances.

Tips for Avoiding Elder Financial Exploitation:

Always involve trusted family members, friends, or professionals in financial decisions, especially for older adults.

Be cautious about unsolicited offers, especially those targeting seniors with no prior relationship.

Avoid signing anything without thoroughly understanding the document—consult with an attorney or financial advisor first.

How Consumers Can Protect Themselves

CA’s real estate market presents a number of risks to consumers, but with due diligence, research, and professional assistance, you can protect yourself from falling victim to these common frauds.

Always trust your instincts and seek advice from trusted professionals before making any major financial decisions.

If you believe you have been a victim of a mortgage crime or have a concern or complaint about a real estate salesperson or broker, you can file a complaint with the DRE.

The Department of Real Estate

is the regulatory agency that enforces the

Real Estate Law,

Subdivided Lands Law,

and

Vacation Ownership and Timeshare Act.

DRE oversees the licensure of approximately 434,000 licensees.

DRE's mission is to safeguard and promote the public interests in real estate matters through licensure, regulation, education, and enforcement.

Consumer protection is DRE's highest priority.

courtesy of DRE

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February 20, 2026

DRE Urges California Seniors Watch for Targeted Real Estate and Property Scams

Sacramento, Calif. – The California Department of Real Estate (DRE) encourages seniors to be aware of real estate and mortgage fraud targeting older adults. Scammers increasingly target seniors with real estate and mortgage-related deception, exploiting their trust and financial vulnerability.

The following tips aim to help Californians safeguard themselves before harm is done, as well as how to report this type of fraud.

Fraud Avoidance Tips

1. Be vigilant, diligent, and suspicious, and proceed very cautiously, when contacted by strangers.

2. Use only licensed professionals when engaging the services of people or companies offering rental, home loan, foreclosure rescue, or other real estate services on your behalf. Check licensing at dre.ca.gov and dfpi.ca.gov.

3. Never pay in cash, or wire cash to anyone, in connection with real estate transactions; Also, be certain to protect your personal information, such as social security number, so scammers cannot steal your identity.

4. Never pay anyone for home loans or foreclosure relief services in advance of successfully completing the work you wanted them to do for you.

5. Never sign an agreement for a real estate transaction (including a Rental) or a home loan that you cannot afford.

6. Never sign a real estate (including Rental) or home loan agreement that you do not understand or have not read, or which contains blank spaces.

7. Anyone (including scammers without an appropriate or legitimate California license) can advertise on television or radio, in newspapers, magazines or on the Internet.

8. Just because someone looks professional, sounds like an expert, and/or gives you confidence in their real estate knowledge, does not mean that you can or should trust them.

9. Never transfer or sign your home over to any third party or anyone else who claims that such a transfer can or will help you repair your credit or keep you in your home. Also, never sign a “power of attorney” giving rights to your property or money to any individual – or any company – you do not personally know and trust.

10. Monitor and periodically check the title to your real estate holdings, just like you check your credit reports; and act immediately if you detect fraud.

11. If something sounds too good to be true, it probably is!

Current Types of Real Estate Fraud

Foreclosure Rescue Schemes

Scammers promise to save a homeowner’s property from foreclosure in exchange for fees or title transfer. Victims often lose both their homes and money when no real help is provided.

Unlicensed Prepaid Rental Listing Services Fraud

Scammers offer rental property lists for a fee without proper licensing. Victims often pay upfront but receive outdated or nonexistent listings, leaving them without a rental and no recourse.

Timeshare Resale and Rental Schemes

Fraudsters promise to sell or rent timeshares for a fee but either fail to deliver, exaggerate property value, or sell nonexistent interests, exploiting owners’ desire to liquidate or monetize their timeshare.

Online Rental Fraud

Scammers advertise fake rental properties online, often requesting deposits or personal information before disappearing, targeting people searching for homes or vacation rentals.

Unlicensed Property Managers

Individuals manage rental properties without the necessary real estate license, potentially leading to mismanagement, legal issues, or financial loss for property owners and tenants.

Real Property Recordation Fraud

Fraudsters forge or falsify deeds and record them against properties without the owner's consent, potentially leading to disputes over property ownership.

Real Property Investment Schemes

Scammers promote high-return real estate investments that are either nonexistent or misrepresented, leading to financial losses for investors.

Reverse Mortgage Scams

Fraudulent schemes target seniors, offering reverse mortgages with misleading terms or fees, potentially leading to loss of home equity or foreclosure.

Vacant Land Scams

Scammers or bad actors posing as owners of vacant land and contact real estate agents for their assistance to sell a property they do not own.

How Consumers Can Report Suspected Fraud

If you believe you have been a victim of a mortgage crime or have a concern or complaint about a real estate salesperson or broker, you can file a complaint with DRE: https://dre.ca.gov/Consumers/FileComplaint.html

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The Department of Real Estate is the regulatory agency that enforces the Real Estate Law, Subdivided Lands Law, and Vacation Ownership and Timeshare Act. DRE oversees the licensure of approximately 434,000 licensees. The Department’s mission is to safeguard and promote the public interests in real estate matters through licensure, regulation, education, and enforcement. Consumer protection is its highest priority. For more information, visit: www.dre.ca.gov.