Q: Can someone steal my home by changing my deed? I see lots of ads offering to secure my property. What do you think?
A: The short answer to your first question is, unfortunately, maybe. There are several ways to steal your property through fraud. We’ve written loan scams and ways to fraudulently transfer ownership, but it’s worthwhile covering it again since there are plenty of businesses offering deed protection and deed “securing” services to homeowners.
Let’s start with the purchase. When you buy a home, the seller signs a document that transfers ownership of the home from their name to yours. This transfer document has several names, including the warranty deed, special warranty deed, trustee’s deed, quitclaim deed, among others. Sometimes people refer to the document as the title to the home.
No matter what it is called, the document is signed by the seller. It is then given to the settlement agent at the closing of the purchase for the home, and then filed or recorded with the office that handles the filing or recording of real estate transactions in the county in which the home is located. Eventually, after the document is filed or recorded, the original document is mailed to you. You should keep that document in a safe place in case you need it in the future.
This gets us to the first types of ads you’re seeing: companies that offer to obtain a copy of the deed for you, for a fee. In most cases, you already should have the original of the deed to the home. If you lose it, and find that you need it one day, you can always purchase a copy by going to the office that handles the filing and recordings of real estate documents.
In some locations, you can download a copy for free or you can get a certified copy of the original for a fee. In either case, the fee that you pay the governmental office is usually significantly less than companies offering this service.
Typically, you don’t need a copy of the deed unless you are in litigation or a government agency asks you to provide them with proof of the transfer of ownership of the home into your name. If you get that request, you can then navigate the recorder’s office or clerk’s office to get a copy. In the meantime, keep your money and don’t spend it with these services.
Now, let’s talk about fraud. Someone can steal your home out from under you, but it’s a complicated process and may only work in limited situations. And, it can happen in a number of ways.
For starters, the thief would have to forge your name and file or record the forged deed with the proper governmental office. Then, the thief would need to “sell” the home to a third party. The funds from the sale would need to be deposited into their own account, and would likely be moved quickly to a protected account.
Here’s where it gets really tricky: Most prospective buyers want to tour a home before buying it.
Well, if you see someone show up at your home for a “showing” or asking questions about what it’s like to live in the property, you’d wonder what was going on. If you reassure the prospective buyer that the home isn’t for sale, and find out who their “broker” is, it’s unlikely the prospective buyer will put down money to buy the home.
Of course, plenty of people these days buy a home online without ever having seen it in person. So, there is a greater risk thanks to the internet. We can also imagine that someone might want to buy the home for investment purposes and wouldn’t mind having a tenant.
If the “broker” tells the prospective buyer that you are renting the home, the fraudulent transaction may occur anyway. In this instance, the prospective buyer might come to you to collect rent after they have purchased the home with the forged deed only to find out that you have a claim of ownership to the home. The buyer would then have a problem, as you could show that you still live in the home and never signed the forged deed.
These situations are quite rare, and the buyer takes a big risk buying a property when the rightful owner lives in the home (a risk the buyer can mitigate by buying an owner’s title insurance policy).
What Sam has observed in the past is that these forgeries follow a familiar pattern: often in family situations, when elderly parents are taken advantage of; when homeowners rent out their homes; or, when owners of vacant land or vacant homes leave these homes unattended for extended periods of time.
Most homeowners don’t need to worry about these situations and don’t need to pay for these services. But you have to stay vigilant. Some of the local government agencies that handle the filing and recording of documents may have a free process in place to alert homeowners if any documents get recorded or filed against the home. When a new document is filed or recorded on that property, the office sends out an email to the property owner. That system, if available in your area, would give you enough information that something is going on and should be immediately investigated.
Ask if your local recorder’s or clerk’s office has a system in place to notify you of any documents recorded against the title to your property. If not, we recommend that you periodically check the title to your property to see if any new documents have been recorded or filed. Many counties have online systems that allow you to view documents online.
When you go online, you might see mortgages filed against your property or releases of any mortgages you paid off over the years. But if you haven’t taken out a new mortgage for some time, your title shouldn’t show any documents filed or recorded against your property since that last mortgage you obtained (other than a release of the old paid off loan).
(Ilyce Glink is the author of “100 Questions Every First-Time Home Buyer Should Ask” (4th Edition). She is also the CEO of Best Money Moves, a financial wellness technology company. Samuel J. Tamkin is a Chicago-based real estate attorney. Contact Ilyce and Sam through her website, ThinkGlink.com.)
©2023 Ilyce R. Glink and Samuel J. Tamkin. Distributed by Tribune Content Agency, LLC.
