Buying a house is a major milestone that any homeowner should be proud of. But once you’ve planned moving day, your next task is to get home title protection to make sure no one can steal this big investment from you! If you’re wondering how exactly someone can steal a house, the answer is through home title theft, meaning a criminal can basically steal your house via paperwork.
While this type of theft isn’t by physical force, it is still a serious threat that homeowners everywhere should be aware of. After all, you have hundreds of thousands of dollars—and the place you call home—to lose when your title is stolen. So, as you settle into the role of homeowner, learn a little about title theft and how you can prevent it with home title protection methods.
If you’re not sure what home title theft is, the basic premise is that it’s when a criminal puts the deed to your house in their own name. The criminal can do this by accessing the deed to your home without your knowledge and forging your signature to transfer ownership from you to themselves. Once the deed is in the criminal’s name, the home belongs to them, on paper anyway. And unless you frequently check on the status of the deed to your home, it could take you months or even years to find out what happened, unless you have home title protection to help.
In the meantime, the criminal who stole your title could start the process of refinancing your mortgage. If he or she cashes out the equity and walks away—without paying on the new mortgage—you’ll be facing serious financial consequences that could include foreclosure. The criminal could also open a home equity line of credit (HELOC) using your name and your home. If he or she then takes out the equity and walks away without paying on that loan, the bank will come after you for the money, again risking foreclosure.
Finally, some criminals target houses that sit empty—such as vacation homes or investment properties for rent—and try to sell or rent them to unsuspecting people. For instance, they might take pictures of your empty home and put up ads claiming that it’s for rent. Once they have renters who are interested, they request deposits or several months of rent from them upfront—usually totaling thousands of dollars—and then disappear. If the criminal was able to get inside the house and show renters around, it’s possible you could find people living in your vacation house or a rental property the next time you visit it!
Clearly, the point of home title theft isn’t typically for thieves to get a house to live in. Their goal is to make a lot of money by illegally selling it, renting it out, or refinancing. And that means you could lose your house unless you get home title protection. After all, deed theft totaled about $547 million in 2020 alone, meaning the criminals have noticed there’s money to be made by stealing titles. If you want to avoid becoming a victim of this serious crime, it’s helpful to consider home title protection options.
You likely understand the basics of deed theft now, but one question that still remains is how it’s done. How can someone essentially steal the title of your house when they’re clearly not you? The answer is typically by committing identity theft in order to get the information they need to sign paperwork in your name. In fact, in 2017, Experian found just over 30,000 cases of identity theft that led to lease fraud, and that’s just one action criminals might take after they steal your identity.
If you’re wondering how criminals get the sensitive information they need to steal your identity, one common method is through email phishing. This is when cybercriminals send you an email that looks to be from a legitimate source, like your real estate agent or title company. It might discuss subjects that apply to the closing process, such as some paperwork you need or how you’re going to pay for closing costs. So, you open it and click a link or download a file from it, only to accidentally end up with malware on your computer that sends them your personal information.
Cybercriminals can get the same results through phone scams, such as by calling you pretending to be a trusted source asking for private information, like your bank account number or Social Security number. In some cases, you don’t even have to communicate with them to end up with your identity stolen, as they might intercept your mail or dig through your trash to find paperwork that gives them the details they want. Any of these methods can lead to identity theft, which can make it possible for a criminal to steal your home title. Fortunately, you have access to home title protection options that can prevent that.
As a new homeowner, you might feel a bit stressed thinking about how to prevent your title from being stolen. The good news is there are a few simple steps you can take for home title protection.
The first is to reduce your chances of sharing personal information with criminals via email, phone, or mail. You can do this by never clicking links or downloading anything from emails that seem suspicious at all. If you’re ever unsure if the email or voicemail came from a trusted source, such as your real estate agent, call him or her first to verify before you send any private information. And be sure to shred any documents rather than just throwing them in the trash.
As far as mail, make sure everything has your name and address on it. If there’s ever someone else’s name on your house-related mail, this could be a sign that someone stole your home title! In that case, you need to check with your local deed office to make sure your deed still has your name on it. Keeping a close eye on your credit report is also a good idea to make sure it doesn’t claim that your house is being foreclosed on, or that you refinanced and then skipped out on the payments for the new mortgage.
All these steps can help prevent you from being a victim of home title theft. But no matter how careful you are, there’s always a chance it could happen to you. What then? Well, that’s when your owner’s title insurance policy comes in! If you get this upfront, it will pay for your legal fees as you fight to get your home’s title back in your name after a criminal has stolen it, providing you with the home title protection you need for peace of mind. This way, you know you won’t lose the house you worked so hard to buy.
Note that lender’s title insurance is usually required when you buy a house, as this protects the bank if your home’s title is ever in question. Basically, if the title is no longer yours, the bank doesn’t lose its money—but you could. That’s why you should add owner’s title insurance to your title insurance policy as a whole, as these two policies together will protect both you and your lender.
Now that you know how to get the home title protection you deserve as a homeowner, it’s time to get homeowner’s title insurance. LemonBrew Abstract can provide you with this type of policy, as well as escrow services and more. Get a quote today!