What is Title Fraud?
The term ‘title’, in real estate, is used to describe someone’s right of ownership to land. Title fraud is when the title of someone’s home is stolen or a scammer has borrowed money using someone else’s property as collateral.
Title fraud is more than likely to happen on properties which meet these three criteria:
• The property is paid off, with no existing mortgage or liens;
• The property is vacant and not closely monitored; and
• The property is owned by someone vulnerable, elderly or otherwise compromised.
How To Avoid Title Fraud
Watch out for situations that may lead to identity theft
Stealing a person’s identity is the first step to completing title fraud. By being mindful of the points below, you can prevent your own identity theft.
· Be hyper sensitive to who you share personal information with.
· Regularly check credit card statements and report anything suspicious right away.
· Shred documents containing personal information before discarding them in the trash.
· Retrieve personal and business mail regularly to limit mail theft.
· If you use cheques, don’t have them delivered to your home, but instead have them sent to a P.O. Box or your financial institution for pick up.
· Avoid giving out credit card information over the phone if you’re called about a donation, instead call the organization directly if you wish to donate.
· Be careful with emails that request you to log onto websites.
· Be skeptical of threatening phone calls.Get Title Insurance
Title Insurance can protect property owners against any losses related to the property including fraudulent sales. It can also protect you when previous owners haven’t paid off their property taxes or utility bills prior to the sale. Companies like First Canadian Title (FCT) can help with obtaining Title Insurance.
Know who you’re dealing with
Verify and ensure the other party is actually in a legal position to either lease or sell the property via credit scores, references, or even social media. You can also rely on tools like the land registry service to verify the owner of the property and identities of the individuals they are dealing with. The Ontario government also provides a free online tool that allows any member of the public to check the validity and current status of a driver’s licence.
Check your credit report regularly
You can do this for free using Equifax.caSearch for your property
By searching for your property online from time to time you can see if it’s fraudulently listed for sale or rental. If you have a vacation or second home, physically monitor your property to verify there are no persons or activities on the property that you did not permit and there is no for-sale sign posted.
Carson Law is an experienced Real Estate Law firm with many successful closings since 2013. Knowledgeable in Title Insurance, please contact us today should you have any questions or would like to discuss how to protect yourself from title fraud.