It is all too common that after opening a new file for a real estate transaction, we as the closing agent get a call or email from a buyer, seller, or real estate agent asking us why our software/portal requires multiple verifications when attempting to log in. The answer is simple, albeit unsettling. Fraud is on the rise, and fraudsters are now deploying new levels of sophistication to obtain innocent parties’ personal information. Thus, in order to combat the fraudulent efforts, multiple levels of verification have now become necessary to protect the parties’ personal information. While there are a myriad of ways that this personal information can be protected, this blog will focus on one tool called two-factor authentication and how closing agents (the title company or law firm closing the transaction) are using it to protect buyers’ and sellers’ sensitive personal information.
What Is Two-Factor Authentication?
As its name suggests, two-factor authentication is a two-step verification process that requires the user to independently verify themselves using two (2) separate authentication factors. These factors, which typically comprise of two-steps, usually come in the form of (1) a traditional user account and password and (2) a text or call to a designated number (although there are alternate forms of verification factors).
How Does Two-Factor Authentication Protect You?
When properly deployed, two-factor authentication provides an additional level of protection in the event that one level is compromised. For example, if a fraudster is able to obtain your email address and password, they typically would be able to gain access to your information. However, if two-factor authentication is in place, the software would then ask for the second factor verification which would require the fraudster to know or have access to the other separate factor (i.e. cellular device/phone). Using the example above, the fraudster would then need to have access to your cellular device to be able to gain the code that is necessary to complete the verification process. Thus, without satisfying both factors, the fraudster would be dead in their tracks and would not be able to gain access to your personal information.
Is Your Closing Agent Protecting You?
With the increase in fraud, many closing agents are increasing their level of cyber security and are investing in innovative software and platforms that help bolster their security. Here at Berlin Patten Ebling, we have invested in closing software that utilizes two-factor authentication, which provides an added layer of protection to help protect buyers’ and sellers’ personal information as it pertains to the transaction. Although we value the security that our systems provide, not every closing agent utilizes the same technology. Therefore, it is critical that the parties to a real estate transaction, including real estate agents, ask the following question to the closing agent: how are you protecting my information?
If you have any questions or concerns regarding anything mentioned in this blog, please reach out to your trusted real estate attorney.