It's a rare crime but title theft could cost you a fortune to unravel: Internet Scambusters #1,054
Title theft, or deed fraud, happens when someone transfers your home ownership to themselves, either by forging your signature or tricking you into signing the necessary documents.
It doesn't happen very often, and you more than likely haven't really lost your home, but when it does it can take years and a lot of money to straighten things out.
In this week's issue, we'll explain how the crime works, how to spot it, and how to safeguard your home against the crooks.
Let's get started…
Don't "Lose" Your Home To Title Theft Crooks
Imagine receiving a foreclosure notice on your home. Plus, maybe demands to pay off a second mortgage and other outstanding bills. And perhaps even an eviction notice.
All of this, when you don't even have a mortgage and have always paid all your bills on time.
If this happens to you, it's likely you're a victim of home title theft, or home deed fraud. Someone forged your signature on the deed transfer and other legal documents and, at least at first glance, has taken ownership of your house without you knowing.
Alternatively, perhaps an elderly or mentally incapacitated person is tricked into signing a deed transfer, handing legal ownership to the scammer, who is sometimes a relative or supposed friend.
Then they maybe sell it to someone else or raise mortgages and other loans before finally disappearing with their ill-gotten gains.
As scams go, title fraud is fairly rare. In fact, there are no reliable statistics on the crime. But it does happen. And every year, Americans find themselves on the receiving end of a complex legal process to try to get their name back on the deed.
Just a few weeks ago, two men were sentenced after pleading guilty to grand larceny for filing fraudulent paperwork to gain ownership of a home whose owner had died.
In another case, a Brooklyn man, said to be in the early stages of dementia, has spent years fighting to avoid eviction after an alleged deed theft dating back to 2008. The home, which the man had bought for $20,000 in 1969, was sold for $2 million to a property company in a foreclosure sale.
This latter case underlines the fact that older folk are a common target in title theft. They may be confused by legal processes and they're more likely to have a considerable amount of equity in their home.
Owners of second homes and vacant properties are also in the scammers' sights because of the possibility their crime won't be spotted immediately.
How Title Theft Happens
On the face of it, title fraud is a simple trick. The scammer just forges their signature on the deed and files it with the local county deeds office. Or they fool you into signing the transfer yourself on the pretext that it's another type of legal document.
But, although title officials are not required to authenticate the signature, numerous other checks may be done, especially if the home is mortgaged. Other documentation may be required, making the crime difficult for scammers to pull off. But sometimes they do.
It may be years before the real owners discover they've been duped. And the longer that takes, the more complicated the process of unraveling the crime, which calls for court action and costly attorney fees.
You may not have legally lost your home but regaining title can cost many tens of thousands of dollars, to say nothing of the mental stress of the drawn-out process.
How To Safeguard Your Home Against Title Theft
Deed or title fraud is considered a part of identity theft. The scammer has to know something about the property, its finances, and the owner, and then has to impersonate them to forge their signature or trick the owner into signing the transfer.
So, safeguarding your personal information is a key step to blocking the crooks. We've covered this topic many times and you can check our reports via the following link: https://scambusters.org/?s=identity+theft.
Another key action is to regularly monitor your credit reports, which will contain information about any attempts to raise money against your home. Look out too for unexpected bills or correspondence with an unknown person's name. Even the absence of regular bills could be a red flag because a scammer may have redirected them.
You should also keep a close eye on the deed itself. Mostly, deeds are held in publicly available county registers that are usually available online. Access to this information is usually free or available for a small fee.
To learn more about how to do this, check out this wikiHow guide: How to Find a Deed Online.
You can also pay specialist companies to monitor property title activity and notify you of any new or recent activity. These are usually referred to as "title lock" services. But if you decide to use one, research the providers carefully as some have themselves been accused of being scams.
Same goes for so-called title insurance. Because incidence is rare, insurers tend to charge a low premium for cover of up to $1 million, which includes legal costs of restoring title and compensation for other losses because incidents are not common. But again, it's important to do your research as some companies have been accused of failing to live up to their promises.
What To Do If Your Property Title Is Stolen
If you discover any suspicious activity with regard to your property deed, time, as we said, is of the essence. You need to report the suspected crime to your county records office, to the credit reporting agencies, your bank and/or mortgage provider, and to law enforcement.
Most importantly, you need to speak to a specialist attorney with experience in dealing with title theft, since you will most likely end up in court fighting to get back what is legitimately yours.
This Week's Scam Alerts
Not Geeks: The name of electronics retailer Best Buy's popular Geek Squad of technicians is once again being used by scammers to send out phony receipts for $199.99 for annual membership, which you never ordered. Victims receive the notification along with a phone number to dispute it. But if you call, you'll be asked for your bank or credit card details to supposedly issue a refund. If you get one of these, it's a scam. But if you're worried, contact the company at bestbuy.com.
Speaking Your Language: The US Federal Trade Commission (FTC) has launched a multilingual effort to alert non-English-speaking citizens about scam risks. The service, available via ftc.gov/languages, provides scam-related information in Amharic, Arabic, Chinese (Simplified and Traditional), French, Hmong, Korean, Russian, Somali, Tagalog, Vietnamese, and Ukrainian.
Time to conclude for today -- have a great week!