In our era of identity theft, title fraud costs Canadians $300 million annually. It’s a serious problem that often impacts older adults.
What is Title Fraud?
Title fraud occurs when someone other than the lawful owner transfers the property to themselves or obtains a new mortgage to pull cash out of the house. This leaves the true owner with a mortgage registered against the property. Scammers are attracted to higher-value properties that are already mortgage-free.
The scammers will place a fraudulent mortgage against a property and disappear with the money. No payments are ever made. Months down the road, the mortgage company begins to attempt to collect on the delinquent mortgage. This is often the first time the homeowner becomes aware they have been defrauded. While the homeowner is trying to prove they didn’t take out the mortgage, the mortgage company is starting to go thru the collection and foreclosure process.
Seniors can be popular targets for several reasons:
– Many seniors have their homes paid off making it easier for thieves to place a mortgage on the property.
– If you are a snowbird and winter down south, having your home vacant for months makes it a target.
Relatives or caregivers can take advantage of people suffering from a loss of mental capacity and forge a power of attorney to gain control of a property and then sell or mortgage the property.
With so much personal information available on the internet, it has become even easier to commit title fraud. People lose their homes to this crime.
Protecting Yourself from Title Fraud
There are a variety of legal actions a person can take to recover from fraud. What can be done to prevent title fraud in the first place? The first thing is to be vigilant.
Before signing real estate paperwork, it is good practice to consult your own lawyer. Be clear about what you are signing. Legal language is confusing to anyone.
Acquire title insurance
Title insurance is an insurance policy that protects your home from title fraud as well as other title problems. Buy title insurance at the time of purchase, but it can be added later. It is good for as long as you own the property and only needs to be purchased once.
The cost is as low as a few hundred dollars. I recommend all my clients invest in title insurance.
If you plan on living in your home for the next few years it is worthwhile protection. There are several different title insurance companies that offer policies. Don’t be a victim of title fraud! Your home is perhaps your largest personal asset.
Roy Thomas SRES® (Senior’s Real Estate Specialist) is a REALTOR® with Sutton Group Professional Realty. Since 1991, Roy specializes in helping retirees with their later in life real estate transactions. Call Roy at 902-497-3031 or contact Roy here