Deed Fraud: Losing Your Home With the Stroke of a Pen
One little known aspect of identity theft is deed fraud. Deed fraud occurs when someone steals your identity, forges your name on a deed, and takes title to your home. While it may seem that it should be a simple matter to get your home back after becoming a victim of deed fraud, nothing in the law is very simple.
In 2014, New Yorker Jennifer Merin first became aware through unpaid water bills that a home she had inherited was being lived in by Darrell Beatty. Beatty had merely forged a deed to the home and moved in.
It was not until late 2015 that Merin was finally able to evict Beatty at a cost of $100,000 in legal fees. Beatty was eventually convicted of fraud and sentenced to a year in prison. Merin also lost hundreds of thousands of dollars in damage to the property and family heirlooms.
How deed fraud occurs
Deed fraud stemming from a deceased previous owner—as occurred in Jennifer Merin’s case—is a common scenario for deed fraud. The crime is also known as “property title theft” and “identity theft house stealing.” Scam artists, the only criminals we refer to as artists, regularly scan the obituaries looking for homes that are vulnerable to deed fraud.
Tip: If a family member dies, you should consider initiating a probate of the estate as soon as possible and monitoring the registry of deeds for anything affecting the real estate of the deceased.
In particular, vacation homes, abandoned homes or unoccupied homes are primary targets of deed fraud, although scammers also target homes being used.
Sometimes, the scammers will live in the homes, as was the case with Darrell Beatty. Other times, they will turn around and sell the property to an unsuspecting buyer, which can really complicate things.
3 warning signs of deed fraud
Here are some of the telltale signs to look out for that may indicate you have become a victim of deed fraud:
- Unpaid bills. A notice for an unpaid water bill, tax bill or mortgage bill or, interestingly enough, not receiving a water bill or tax bill that you should have received. In that case, an identity thief may go to the taxing authority and change the address to which the bills will be sent to hide the crime longer.
- Notice of foreclosure. Receipt of a notice of foreclosure when you don’t even have a mortgage.
- Signs of life. Evidence of activity at an unoccupied home or vacation home.
Why doesn’t the registry of deeds screen deed recordings better?
When recording deeds, the registries of deeds check to see if the format of the deed is proper, the deed is signed, and the signature is notarized.
However, it may not be a function of registries to compare signatures on record for forgeries or otherwise inquire about the legitimacy of the deed.
There are things you can do to help protect you from deed fraud.
3 ways to help protect yourself against deed fraud
As with many types of fraud or identity theft, the earlier that you become aware that you have become a victim, the better off you will be. Here are a few things you should do.
1. Monitor your credit reports
Federal law provides you with the right to have a free copy of your credit report from each of the three major credit reporting agencies, Equifax, Experian, and TransUnion. Monitoring your credit report can help you discover financial actions taken by others in your name.
You can leverage your free annual credit report into one report every four months. For instance, you can request your free credit report from Equifax, and then four months later get your free credit report from Experian, and then another four months later obtain your free credit report from TransUnion. You can get your free credit reports through AnnualCreditReport.com.
You also can get credit monitoring through various identity theft protection services.
2. Check the status of your deed
Local registries of deeds across the United States may be accessed online. If this is true for your local registry, you should regularly check on the status of your deed to confirm that no one has done anything affecting your property ownership.
Some registries of deeds even have services whereby you will be notified when actions are done that affect your property. You should see if your local registry of deed provides this service and consider signing up for it, if available.
3. Consider buying an owner’s title insurance policy
Owner’s title insurance can offer significant protection from the harm caused by deed fraud and can cover the costs involved in correcting the problem.
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