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Home Title Fraud

What is it?

close up of businessman hands signing contract

These days, it really seems like fraud is rampant. Fraudsters are always coming up with new ways to scam people out of their money and resources. It's so important to stay vigilant and aware of all of the latest forms of fraud. One worth thinking about is home title fraud.

What is home title fraud?

Home title fraud occurs when someone fraudulently transfers ownership of your home to themselves or to another party. In order to sell a home, the seller has to sign the deed. If the fraudster is able to forge a signature and make it appear that you sold the home, they can then claim that someone else is the owner of your property. Typically, this all happens without the homeowner realizing it—until they go to sell the home, take out a home equity loan, or buy new homeowners insurance.

Home title fraud is not actually a new type of fraud, although it seems to be discussed more often lately. It may also be becoming more common as fraudsters have begun using the Internet to commit this type of fraud.

How is home title fraud carried out?

These days, most home title fraud is carried out via the Internet. Phishers may send a text or email asking you for personal information. If you don't realize you are being scammed and you enter that personal information—like your Social Security number or passwords—the attacker can then use this to access the deed of your home and sign it over to themselves or another party.

Most victims of home title fraud are older or less tech-savvy, but even young, tech-savvy people have fallen victim to this type of scam. So, it's important to stay vigilant. Always keep your eyes peeled for phishing attempts, and never share your Social Security number, passwords, or other personal information via email or through a link.

What can happen as a result of home title fraud?

Once a fraudster has successfully signed over ownership of your home, they may sell the home, leaving you in a complicated situation in which a third party believes they legitimately purchased the home from another seller—the fraudster.

You may end up with foreclosure notices, unpaid utility bills, and overdue property taxes, all of which impact your credit score. To find your way out of this mess, you will need to hire a lawyer, which can result in some pretty hefty legal fees.

What should you do as a victim of home title fraud?

If you do start getting noticing of unpaid utility bills, letters from the bank, or communication from anyone who believes they are buying or leasing your home, then you should assume you've been the victim of title fraud. Do not waste any time. Call your bank immediately, and explain the situation. Also, call your county records office; they hold records of all deeds. 

Your county records office will typically work with you in contacting the police, who can investigate whether any fraud has been committed. If the police do find evidence of title fraud, they will likely recommend that you contact a lawyer. If you had title insurance when you bought the home, you can also contact the title insurance company, but note that most policies do not cover you once the sale is complete.

Title fraud is one of the many forms of fraud you need to watch out for these days. Protect yourself by being wary of any phishing attempts, and by contacting authorities ASAP if you have any suspicions of fraud.

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