Identity theft is rampant, costing people as well as insurance and banking systems billions of dollars per year. Its proliferation is mainly due to the fact that it works – Of course more criminals will find ways to lie, cheat and steal what they can from innocent individuals if they can get away with it. Any piece of information you leave exposed in the digital or physical world can be taken and used to make money. Most often, people think about the common crimes of banking or credit card fraud. Yet, there is a more catastrophic form of identify theft that any homeowner should understand and be on alert for: Home title fraud.
Home title fraud is when a home or property you own is quite literally stolen out from under you. Through some identity theft measures, fraudsters will then forge a deed along with other records and submit it to your town. If that deed gets recorded, the ownership of your home essentially transfers from you to the ‘new’ owner. From there, the criminal can open a loan against the value of your property and withdrawal the funds before anyone catches on to the act. Or, they can sell the property outright, typically to accomplices in the scheme.
After the change in ownership, an unsuspecting homeowner may continue to pay the mortgage on a home that they legally no longer own. Simultaneously, debt piles up against the property creating a dire financial situation.
What Happens Next?
In many cases, home title fraud is only discovered after the crime has been committed and the perpetrators are long gone. At that point, there is little to no recourse. Often, the victim loses their home. Administratively, it can cost many thousands of dollars in legal and court fees, and it can also tank your credit score if you are unable to pay any loans that have been opened in your name.
When Does Title Fraud Happen?
Title fraud is not as prolific as credit card fraud, simply because it takes more steps and requires a higher degree of savvy. Yet, the payoff for them is huge if they are successful in their crime. In 2017, there were 9,654 cases of general real estate fraud, resulting in more than $56 million in losses. This number has skyrocketed with 11,578 cases of general real estate fraud reported in 2021, totaling more than $350 million, which means it’s happening more often and with greater effect.
Most often, vacant homes and seniors (who are more likely to have a lot of equity in their homes) are targeted.
How Do I Prevent Title Fraud?
As with most things, vigilance is key. Periodically check your public record filings for any changes in ownership. Also keep your eye on mail that comes to your property from a bank or lender as they may pertain to a new account opened using your address. You can also sign up for credit monitoring services or check for local programs that can help monitor and prevent these types of crimes. If you have elderly family, consider checking in on their records or set them up with similar monitoring services so they don’t become victims of home title fraud.
Protection is Available for Bucks County Residents
Bucks County has introduced a free fraud alert system that any Bucks County resident can take advantage of. In their own words:
“If you sign up, you will receive an email from our recording vendor, LANDEX, alerting you anytime a document has been recorded in our office against your name. Businesses are also welcome to sign up for this service.”
Principle Abstract and Settlement Services urges anyone in Bucks County to sign up for this service for added protection and peace of mind. You can find our recent blog on this service with instructions on how to sign up.
If you have any additional questions on home title fraud or would like assistance with a real estate transaction, give our office a call and a member of our team will be happy to assist you.