What Is Home Title Fraud?

How Does Home Title Fraud Happen?

Home title fraud, also called home title theft, typically begins with identity theft. Fraudsters may steal your identity, your Social Security number or other private information in order to forge title transfer documents. Common methods include a forged quitclaim deed, warranty or grant. The scammers then file the new paperwork with the appropriate parties, like your town clerk, to record the transfer of ownership—all without your knowledge.

Once your home's title is in the hands of scammers, you no longer technically own your home—even if you continue to make your mortgage payments. Scammers can use your home as collateral to refinance your home or take out new loans, like a second mortgage or a home equity line of credit (HELOC). They may also illegally sell the house or use it in a rental scam.

Home title fraud can lead to serious financial consequences, including foreclosure and credit issues or having your home sold out from under you. Unfortunately, homeowners don't often realize they've been victims of home title fraud until it's too late.

How Common Is Home Title Fraud?

The FBI's 2023 Internet Crime Report found that in 2023, more than $145 million was lost to real estate-related crime, which includes title fraud; over 9,500 complaints were filed. While that's a relatively small portion of the nearly 900,000 complaints the office received in 2023, this type of fraud can be devastating when it occurs.

As serious as it is, however, it is often difficult for fraudsters to carry out. Lenders, title companies and realtors generally have strict processes in place to confirm the identity of people involved in real estate transfers, including credit checks and reviews of important documentation such as bank statements and personal identification.

Still, the FBI and other federal and state agencies encourage homeowners to remain vigilant. In 2024, the FBI issued a warning about a recent wave or property title fraud involving vacant land sales. And in 2023, New York state passed legislation to help protect home title fraud victims and has a dedicated website to report suspected deed fraud. Maryland also issued a warning notice to homeowners in 2022 about home title fraud.

The Federal Housing Finance Agency (FHFA) has several programs in place to help homeowners protect themselves against real estate fraud, including home title theft.

Signs of Home Title Fraud

Home title fraud can be tricky to spot. But there are some signs homeowners can look out for that may indicate home title theft has occurred, is in process or is being attempted.

• New loan bills: If statements for loans you don't recognize show up in the mail, including HELOCs or second mortgages, it's possible someone is using your home's equity to commit fraud.
• Foreclosure notices: Receiving communication threatening foreclosure from your lender, or other financial institutions, may mean you've been a victim of home title fraud—especially if your mortgage payments are up to date.
• Bill changes: If you notice that certain bills related to your home stop showing up in the mail or spot inaccuracies in key information on the bill, like the account holder name, it could be a sign of home title fraud.
• Stopped automatic payments: When automatic payments to your mortgage company, homeowners insurance or taxes suddenly stop being deducted from your bank account, home title fraud may have occurred.
• Suspicious activity on your credit report: Newly opened accounts or credit inquiries could mean you've been a victim of identity theft and potentially home title fraud.
• Real estate activity: Calls from realtors or other suspicious real estate activity, including listings to sell or rent your house, could be indicators that your home's title has been illegally transferred.

How to Prevent Home Title Fraud

Like all types of identity theft, home title fraud can be a challenge to prevent. But it's possible if you stay vigilant. Home title fraudsters often target paid off homes, vacation homes or frequently unattended properties and homes owned by seniors.

Consider these steps to help prevent home title fraud:

• Don't leave your home unattended for long periods. An unoccupied home can be a target for title thieves. Even if you're not in your home year-round, it's important to make it seem like someone is home. Keep up with yard work, bring in the mail and consider using timers to turn on indoor and outdoor lights.
• Keep an eye on your mail. Read all mail closely, like bills and lenders statements, to confirm you recognize the sender and that the account information looks correct. Watch out for mail from senders you don't recognize, including junk mail offers for new credit cards and loans.
• Watch your bank statement. Checking your bank statement often can help you spot payments you don't recognize early. You may also notice when scheduled automatic payments, like your mortgage bill, abruptly stop being debited from your account.
• Monitor your credit. Keeping close tabs on your credit reports is an important part of avoiding all types of identity theft, including home title fraud. Look for credit accounts you don't recognize, like new loans or credit cards, along with any missed payment. It's also a good idea to check your credit scores regularly as an expected dip could be a sign that's something amiss.
• Check your town's records. Every municipality keeps an official record of property documents, like the deed to your house. Contact your town clerk every so often to double-check that nothing is amiss with your home's title paperwork.
• Consider title protection. Some companies offer title protection, also called title lock insurance, to help safeguard your home's title. But the Federal Trade Commission (FTC) cautions that not all title protection companies are legitimate, especially those that send unsolicited offers. Be sure to do your research if you want this protection.

How to Report Home Title Fraud

If you suspect that your home's title has been stolen, it's important to report the fraud as soon as possible. Here's what to do if you suspect home title theft on your property:

• Contact your mortgage lender. Let your mortgage company know as soon as you suspect home title theft. They may be able to assist you in navigating the complexities of home title fraud.
• Contact any other lenders involved. If you've received bills, foreclosure notices or any other communication from lenders you don't recognize, let the lender know fraud is suspected.
• Report the fraud to the authorities. Home title fraud should be reported to the FTC as well as any appropriate offices in your state, such as the attorney general. Check with your state to see if any specific protocols need to be followed. You may also want to let your town record clerk and property tax collector know that home title fraud is suspected.
• File a police report. Home title fraud is a serious crime that may also involve identity theft. Filing a police report helps you establish a formal paper trail that may come in handy if the situation escalates.
• Alert the credit bureaus. You have the right to freeze your credit or request a fraud alert be placed on your credit file maintained by all three credit bureaus (Experian, TransUnion and Equifax). Fraud alerts ask creditors to take extra steps to verify your identity when they receive an application for credit in your name. You also have the right to dispute anything on your report you believe has been reported in error or as a result of fraud, such as new accounts or activity you don't recognize.

The Bottom Line

Since home title insurance is still considered rare, it's likely something you may not give much thought to. But if you're a victim, the consequences could be devastating. Recognizing the signs of home title fraud and taking steps to prevent it can help you keep your home's deed, your finances and credit safe. Keep close tabs on your property, bank statements, mail and credit.

With Experian's free credit monitoring service, you can get real-time alerts when changes are made to your Experian credit report. You'll also get free access to check your FICO^® Score^☉ and Experian credit report anytime, making it easier to watch out for unfamiliar activity.

If something seems off, you'll be in a better position to catch it quickly and take action.