Here's how to protect yourself from real estate fraud

While it’s not common, real estate deed fraud is on the rise across Indiana and the United States.

Our definition comes from the FBI: “Deed fraud often involves identity theft where criminals will use personal information gleaned from the internet or elsewhere to assume your identity or claim to represent you to steal your property.” The two types of deed fraud most often cited by the FBI are quit claim deed fraud (fraudulent use of a legitimate tool to transfer property) and impersonation deed fraud (when scammers pose as property owners).

Scammers usually take ownership of the properties without the owners’ knowledge. Since the pandemic, the increasing frequency of real estate transactions completed via email and phone make these scams easier to perpetrate.

The FBI is warning owners of homes, commercial buildings and vacant land to “regularly check their property records and register for fraud alerts to help avoid what are sometimes losing battles against getting robbed of their own property.” Seniors are particularly vulnerable because they typically don’t have a mortgage, which makes property transfers easier with one less party involved. Seniors are also more likely to own vacant land or second homes and might not be able to personally keep close tabs on their property.

Quit claim deeds are legitimately used to quickly and more seamlessly transfer property from an owner to an adult child or another trusted individual. However, scammers create and use fake quit claim deeds to steal property. In many instances, they record the fake deeds online.

With impersonation fraud, fraudsters forge documents to record a phony transfer of property ownership. At that point, “criminals can then sell either the vacant land or home, take out a mortgage on it, or even rent it out to make a profit, forcing the real owners to head to court to reclaim their property,” said the FBI statement. “The scammers often renovate empty houses and pay property taxes or utility bills to help establish ownership and then sell the property.”

While it’s smart for property owners to take precautions against deed fraud, those measures are not a guarantee that it won’t happen. Buyers also need to protect themselves from unknowingly purchasing compromised property. However, property owners who take the following steps might limit the likelihood of getting scammed or of unwittingly buying a property from a scammer.

◗ If you own property that you are not geographically close to, enlist someone locally to periodically check in for unusual activity. Watch for changes in utilities or an absence of property tax bills.

◗ Sign up for Property Fraud Alert Service. This is a free service offered by Indiana counties. Go to propertyfraudalert.com and select your county where you can sign up to get notified via email, text or call when your name appears on new property documents. This acts as a crucial early warning system.

◗ Set up a Google Alert for your property address and monitor real estate websites like Zillow, Redfin, Realtor.com or Facebook Marketplace so you can see when someone posts something about your property.

◗ Be protective of personal info: Don’t share personal details with unverified sources. Identity theft often starts this way.

◗ Use trusted professionals: Work with reputable title companies and real estate agents. Trusted professionals should also be aware of suspicious or unusual requests to list properties. Proper title insurance should protect an unsuspecting buyer.

To regain your property title after deed fraud, you must act fast. Contact authorities (police, county recorder), get a real estate attorney for a “Quiet Title” lawsuit, alert lenders, put fraud alerts on credit and file an FTC report, leveraging title insurance if you have it to cover costs and legal help. The process involves proving the deed is fraudulent, often via forgery, and getting a court order to restore ownership. That can be a lengthy process, but it generally results in the rightful owner getting their property back.•

~Jalene