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Identity Theft: Is Your Home At Risk?
Fall is upon us. I for one am anxious to get to cooler weather (hopefully) and the plethora of festivals and holidays that fall (pardon the cheesy play on words) around this time of year. It’s really my favorite time of the year. So, before we delve into today’s topic, I just want to wish you, our dear reader, a pleasant new season and thank you for spending time with us through our articles every month. Now, on to the subject at hand.
I’m sure you’ve all heard the radio com-mercials. You know, some big-named radio personality urgently expressing angst that your home ownership may have already been (or could be in the future) compromised by theft and forgery.
The ad claim for immediate action revolves around the premise that nefarious actors can steal your identity and deed your property to themselves. Furthermore, those bad actors may mortgage or even sell your home without your knowledge. You’ve now lost the equity of your largest asset and may even be evicted.
I don’t know about you, but that’s scary stuff! After working as hard as me and my wife have all these years to secure a home, I certainly wouldn’t want that to happen to me and I’m sure you wouldn’t either. So what’s a homeowner to do? Well, don’t despair, the radio ad gurus offer just the solution…simply buy their title theft insurance.
Not only will they protect your title with round-the-clock monitoring, they’ll also alert you when a fraudulent title transfer is filed. These companies charge you for protection but it’s highly unlikely any such company will ever pay out a dime of insurance.
I’m not saying this type of theft and the pains of getting it fixed can’t happen, it does. However, like most things, there’s some truth mixed in with the marketing gimmick.
First off, it’s not typically insurance but a monitoring service. Second, it is true that anyone can forge your name to any document, including a deed supposedly transferring title to the forger. Such a deed could be filed with the county Register of Deeds. However, that doesn’t mean someone has stolen your title.
There’s no validity to a forged deed and it doesn’t convey anything. Only you can legally transfer your title to a third party. If a buyer or a lender rely on a forged deed and don’t do their due diligence on a property’s title, they are out of luck. They, not the legitimate property owner, will ultimately lose any money paid to the fraudster.
A forger could easily get a blank deed online and fill in your property’s legal description obtained from public records but their signature must be certified by a Notary Public. A notary who is required by law to verify your identity.
Fortunately, it’s almost impossible for thieves to mortgage or sell property to a knowledgeable and reputable lender or buyer. Real estate firms, lenders and title companies have so many safeguards in place that there’s virtually no chance a fraudulent transfer won’t be discovered. The required employment and income verifications, tax returns, credit reports, appraisals, and title insurance are bound to alert you and the lender that some-thing is wrong.
Even with a cash buyer, a thief’s chances of success are small. Only the most naïve buyer will fail to obtain title insur-ance. Title insurance protects buyers against defects in the title, including liens, fraud, and forgery. It will alert the buyer or lender to any defects prior to closing. If a title company misses a defect, they must pay for any damages. No legitimate attorney or real estate firm will allow you to buy a property without this insurance.
Hopefully a buyer isn’t naïve enough to purchase property without a legitimate appraisal or title insurance, it is possible they could be conned. If they show up in your driveway with a moving van, however, they – not you – are the ones at risk of losing their money.
Since forgery is a felony in all 50 states, courts may require restitution for dam-ages caused by the forgery, such as the costs of title clearing.
In the extremely unlikely event that someone goes go the trouble and risk of committing all these crimes, the cost of clearing the title is the biggest risk to a homeowner. That will require the assistance of an attorney. Wouldn’t that potential expense make it worthwhile to consider buying title theft insurance? Perhaps, assuming the policy covered such expenses. Unfortunately, none do.
I hope this is helpful to your retirement journey. Call us, come see us or visit us at www.woottonfinancial.com, we’d love the opportunity to help address your questions and concerns and provide you Clear Direction for Your Retirement®.