How to Protect Your Home From Deed Fraud
Learn how to monitor your property records and prevent criminals from stealing your equity.
Donna LeValley
Imagine waking up one day to find your name erased from your deed — or worse, your home sold out from under you. Deed theft, also known as title fraud, is a real and rising threat, with crooks forging documents to steal homes or secure fraudulent mortgages.
According to the FBI’s IC3 Report, there were 9,359 real estate fraud complaints in the U.S., with reported losses totaling $173.6 million. Of those complaints, 1,765 were filed by individuals aged 60 or older, whose losses amounted to $76.3 million.
While seniors represented about 19% of the real estate fraud complaints, they bore nearly 44% of the total financial losses, highlighting the impact on older adults.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Even high-profile cases, like the attempted fraudulent sale of Graceland, highlight how even iconic properties aren’t safe. But don’t lose sleep just yet. There are smart, low-cost ways to safeguard your most valuable asset.
From free county alert systems and vigilant record checks to enhanced insurance policies, you can protect your home without breaking the bank. Here’s how to stay one step ahead of deed thieves.
What is deed theft?
Deed fraud is a type of identity theft. A criminal identifies a potential home to target — often a second home, rental, vacation home or vacant house — and then forges the true owner’s signature on the deed as they “sell” it to themselves or a third party such as a trust.
When they register the sale at the county recorder’s office, they’ll use personal information gleaned from the internet or elsewhere to assume your identity or claim to represent you.
They will employ fraudulent identification, a counterfeit notary signature, or even work with an unethical registered notary to pull off the scam. After taking ownership of the property, they’re free to do whatever they want — even sell it to a legitimate buyer.
What can a criminal do with your deed/home title?
Once a thief gains control of your title, they can wreak havoc. In the worst-case scenario, they might sell your home or take out loans against it, effectively stealing your hard-earned equity.
If they default on those loans, you could face foreclosure or discover you can’t sell, refinance or even pass the property on to your heirs.
Criminals can make money from a forged deed in several ways:
- Illegally renting out the property.
- Opening a home equity line of credit (HELOC).
- Refinancing the mortgage to cash out the equity.
- Sell the home to a legitimate buyer and pocket the profit. This is a common approach for unoccupied vacation homes or rental properties.
How to protect property from deed theft
Homeowners should make sure the appropriate authorities have your correct mailing address for you or the person who should receive notices about your property.
If you go away for an extended period of time, have mail forwarded or ask someone you trust to pick up mail and visit your home. Periodically visit any vacant house to ensure that no one has taken up residence illegally.
Look for deeds that you or your attorney didn’t prepare or sign, or loans you didn’t take out, as well as liens of contractors, subcontractors, real estate brokers or attorneys whose services you didn’t hire.
Criminals often target vacant properties — such as vacation homes — especially if the legal owner is deceased. Older people are also common targets because they often have more equity in their homes, and they might not be tech-savvy or aware of the dangers online.
Here are four steps you can take to prevent deed fraud:
- Pay attention to incoming bills. Keep a close eye out for mortgage, tax and water bills. Sometimes, thieves change the address on bills to hide their crime, giving them more time to profit from the property. If you’re looking out for older family members, make a note of when they receive bills each month and check to make sure the bills continue arriving
- Check the status of your property deed. Anyone can check local registries or the county recorder’s office for land records and property deeds online in the United States. Try to check your deed's status regularly to ensure no one is trying to take over your ownership rights. Or better yet, if possible, set up notifications at the registry to alert you to any changes
- Monitor your credit reports for signs of identity theft. Most people only look at their credit reports when they’re applying for a mortgage or loan. However, if you want to avoid becoming the victim of deed fraud, you should be more vigilant. The three major credit bureaus — Equifax, Experian and TransUnion — offer a free credit report to consumers each week at AnnualCreditReport.com.
- Check if you have a title insurance policy or buy one when refinancing. When you buy a house or refinance, you can purchase enhanced title insurance through the American Land Title Association (ALTA). Their Homeowner's Policy ensures against impersonation or forgery. Ask your title company for help with pricing and signing up.
- You could pay for a monitoring service. You could pay for a title monitoring service. Companies like Home Title Lock, LifeLock, and Aura offer home title protection plans that monitor your property records and alert you to potential fraud. These services typically cost between $10 and $25 per month. But if you’re tech-savvy and diligent, you can monitor your property yourself by regularly checking your deed and title records through your county’s register of deeds website.
Five signs you’re the victim of deed theft
There are indicators that fraud may have occurred that you can monitor. Acting fast is crucial if you think you've fallen victim to any fraud. Take action as soon as you notice something suspicious before criminals can do too much damage.
Look for these warning signs:
- You stop receiving your water bill or property tax assessment or bill.
- Utility bills on a vacant property rise suddenly, or you find people living there.
- You stop receiving your tenants’ rent payments and learn that they’ve been making the payments to another person and location.
- You receive payment books or other information from a lender with whom you haven’t done business.
- You find yourself in default on a loan or notified of foreclosure proceedings.
Municipal resources
Many counties now provide a consumer notification service. Register for free, and you’ll quickly receive an email or text anytime a document is recorded on your property. Currently, there is no central database to direct you to state or county notification services.
Invest the time and explore your local registrar's website and see what services they provide. If they don't have an online database, take a trip to your county registrar's office to physically examine the title to your property.
If you experience or find something amiss, notify the register of deeds and local law enforcement. Homeowners who think they are victims of deed fraud are urged to act quickly to report fraud to your local sheriff, get a certified copy of the fraudulent document from the register’s office, report the crime to the district attorney’s office in the jurisdiction where the property is located, and consult an attorney to help confirm ownership of the property. (Legal action known as “quieting the title” may be required to resolve any questions about your ownership of the property.)
Bottom line
It’s smart to monitor your property proactively — especially if you own high-value real estate or live in an area where scams are on the rise. While there are paid services that offer title monitoring, it’s important to understand that these services can’t actually prevent title theft; they can only alert you after changes are made to your property records.
Fortunately, you can perform a title check on your own. Start by visiting the website or office of the county clerk or register of deeds where your property is located. There, you can review public records to confirm that your name is still listed on the title and that no unauthorized changes have been made.
Related Content
