For homeowners, there are two big types of scams to worry about: mortgage fraud or identity theft. Home title scams are a growing threat involving identity theft done over the phone or web. Last year, I warned you about deed theft, a very real and very potentially damaging form of identity theft where scammers can steal someone’s home deed. Because of its growing prevalence, it’s important to understand how it can happen and how you can protect yourself.
How Does a Tile Scam Happen?
Scams relating to mortgages and real estate commonly happen digitally or over the phone when a homeowner is tricked into divulging too much information. For example, a fraudster could call a homeowner claiming to be from the mortgage company and the homeowner could share sensitive information which allows for theft of the deed. Common ways a fraudster gets a homeowner to share information is to reach out claiming an opportunity to refinance at a great deal. The homeowner will fill out and sign paperwork which unknowingly signs over the deed to the scammer.
When a title scam happens, it’s not as if the scammer would start living in the home, but instead things like a fraudulent refinance can happen and the scammer can borrow money against your home without your knowledge. They can also use the information they have about you to steal money, open credit cards or open a HELOC (home equity line of credit). Not only would this steal your wealth but it would also ruin your credit score potentially.
According to the Colorado Department of Regulatory Agencies Real Estate Division, this type of identity theft is not just limited to a personal residence and can also happen on vacation homes, rental homes, rental buildings and possibly even commercial real estate. This can happen to any property that has a deed with it.
How Can a Homeowner Protect Themselves?
Obviously this is a very big concern with potentially devastating consequences so homeowners need to protect themselves. For one, always be cautious about sharing information online, especially if you get an email requesting information about your home. Never share information about your home unless you confirm you are actually conversing with your lender. You can do this by directly calling the lender. If you suspect a fraud attempt, call your lender right away so they can freeze your account and start an investigation. Also be sure to change your log-in credentials if you suspect any type of fraud and make sure to have strong passwords. Monitor your mortgage account as well as your credit card and bank statements as well as the 3 main credit bureaus. Finally, if you think the fraud has already happened, you’ll likely need to get the police involved as well since identity theft is a real criminal activity that the authorities need to be involved with.
Do you have concerns or questions about title theft? Are you in the market to buy or sell your home? Call and text me at (720) 323-4176 or email me at [email protected]
