Introduction Deed fraud is a growing concern for property owners across the United States. This article will define deed fraud, examine its different types, and explore how it occurs. We will also discuss the consequences of deed fraud, how to prevent it, and what to do if you suspect it.
What is Deed Fraud?
Deed fraud is a scam in which a fraudster steals the title to a property and illegally transfers it to themselves or someone else. This can be done through several methods, including identity theft, forgery, and fraudulent transfers. Each type of deed fraud has its unique characteristics and methods of execution.
How Does Deed Fraud Occur?
Deed fraud can occur through various methods, including mail fraud, identity theft, forgery, and fraudulent transfers. Scammers often use false documents, such as deeds, powers of attorney, and mortgages, to trick property owners and title companies into transferring property ownership.
One common form of deed fraud is mortgage fraud, in which the scammer uses false information to secure a mortgage on a property they do not own.
In United States v. Russell, a case from the United States Court of Appeals for the Ninth Circuit, the defendant was convicted of wire fraud and making false statements to a financial institution concerning a mortgage fraud scheme. The defendant used straw buyers to purchase properties and obtain mortgages using false income and employment information. The properties were later sold for a profit, with the straw buyers receiving a kickback.
Consequences of Deed Fraud Deed
Fraud can have severe financial and legal consequences for property owners. Victims may be forced to pay off fraudulent mortgages, lose their property, or face legal action from lenders or other parties. In some cases, the damage from deed fraud may be irreversible.
In Mendoza v. JPMorgan Chase Bank, a United States District Court case for the Eastern District of New York, the plaintiff alleged that the defendant bank wrongfully foreclosed on their property due to a fraudulent mortgage. The court found that the plaintiff had sufficiently alleged a fraud claim and denied the defendant's motion to dismiss.
Prevention of Deed Fraud
You can take several steps to protect yourself from deed fraud. These include safeguarding your personal information, monitoring your credit, checking your property title regularly, and being wary of unsolicited offers or requests. There are also services available, such as title insurance and deed monitoring, that can help mitigate the risk of deed fraud.
In Hylton v. Allstate Title Agency, Inc., a case from the Supreme Court of New Jersey, the court held that a title insurance company may be liable for failing to detect a fraudulent deed transfer. The plaintiff, who had purchased title insurance, discovered that their property had been fraudulently transferred to another party. The court found that the title insurance company had a duty to conduct a reasonable investigation into the title and that the plaintiff could bring a claim for breach of contract and negligence against the company.
What to Do If You Suspect Deed Fraud
If you suspect you have fallen victim to deed fraud, acting quickly is important. Here are the first three steps you should take.
Contact local law enforcement and report the crime.
Contact your title company and any lenders involved in the property to inform them of the fraud.
Contact a real estate attorney who can help you take corrective action.
There are also resources available, such as the FBI's Internet Crime Complaint Centercan assist you in reporting deed fraud.
In United States v. Johnson, a case from the United States District Court for the Eastern District of California, the defendant was sentenced to 18 months in prison for his involvement in a deed fraud scheme. The defendant and his co-conspirators created false deeds to properties and then used them to obtain loans from lenders, and the loans were not repaid, resulting in losses for the lenders and the victims who owned the properties.
Deed fraud is a serious issue that property owners must be aware of. By taking proactive measures to protect your personal information and your property title, you can help prevent this type of fraud from happening to you. If you do suspect deed fraud, taking immediate action to minimize the damage and pursue legal recourse is important. At QuickDeeds.com, we take deed fraud prevention seriously and provide various services to help you protect your property title.
In conclusion, deed fraud is a real estate scam that can devastate property owners. Scammers use various methods to steal the title to a property, and victims can be left with significant financial and legal problems.
It's important to take steps to prevent deed fraud, such as safeguarding your personal information and monitoring your property title, as well as being aware of the warning signs of this scam.
If you suspect you have fallen victim to deed fraud, taking action quickly to minimize the damage and report the crime is significant. By staying vigilant and informed, you can help protect your property title and avoid falling victim to this type of fraud.