One of my clients sent me an article titled “Deed fraud is on the rise – here’s how to protect your home” earlier this month. The article, published in the New York Post, stated that there is a new scheme in which criminals forge a phony deed transfer and then sell the home, take out a mortgage, or even rent it out to tenants to turn a profit.
We are seeing this in our market, too. In our area, the fraudsters have primarily targeted vacant land. In other locations, the fraudsters target property that is not owner-occupied or is vacant or a second home. I thought this was an important topic to share with readers of our blog.
Local Scams & Signs of Home Title Theft
Our Park City Board of REALTORS and Multiple Listing Service have taken a proactive role in educating realtors about phony sellers.
Not too long ago, I was contacted by someone who told me he wanted to list a lot on Sun Ridge Drive in Park City. I know there are two streets in our market with this name, one in Pinebrook and one in Deer Valley. I asked the person on the phone which part of town his lot was located. When he could not quickly answer, I hung up and reported the incident to our Board of REALTORS.
There have been other savvy agents in my office who were suspicious about phone calls from “motivated sellers” and eventually tracked down the real owners of the property. Generally, if the seller is “out of town,” wants to price their property below market value, and wants a quick sale, a red flag is raised.
What can we do to prevent deed fraud?
The true protection against home title theft is through a specific type of title insurance policy known as an ALTA Homeowner’s Policy of Title Insurance. In Utah, this policy is written into every standard Real Estate Purchase Contract and paid for by the seller. This policy protects against forgery after the property is purchased and provides further protection against a fraudulent third-party transfer of deed. The policy allows the legitimate owner to make a claim to their title insurance company and the insurer will handle the fraud.
How will you know if a home title theft has occurred?
Summit County and Wasatch County offer a free service that allows residents to register their names with the County Recorder. If any documents are filed including those names, the county will alert the resident.
You can register with Summit County by signing up for its Fraud Guard Alerts online.
If you own a property in Wasatch County, call the County Recorder’s office at 435.657.3210, and they will register your property for a similar program using your email address.
It is unfortunate that criminals are infinitely creative and bold in finding new ways to steal. However, it’s comforting to know that systems are in place to protect the property you own.