Many clients have asked us about title “insurance” or “locks” that claim to prevent losses and wonder if they should be protecting themselves from home title fraud. This is no doubt due to the non-stop ads warning about this very scary threat. This can be a confusing issue and, as with many financial subjects, there is a lot of noise and hype, so here is our take.
Home title fraud occurs when a scammer changes ownership of your home to another name by forging your name on a deed, filing it in the records room of your county courthouse, then takes out a loan using the home as collateral.
In 2017, the FBI reported over 9,600 real estate and rental fraud victims with losses totaling over $56 million. In just two years, this number grew to almost 12,000 victims with losses totaling over $220 million. Sounds scary, but these statistics include all different types of real estate, rental, and timeshare crimes, with only a small fraction of cases involving home title fraud.Home Title Fraud – The Real Risk and How to Safeguard Against It – Cassaday & Company, Inc