Real estate title fraud is not something you’ll want to have to experience during the home buying or selling process. This process is stressful enough, and becoming the victim of a scam such as this will only make it worse. That’s why it is important to be aware that title fraud exists, even when you would least expect it to.
In order to help you be better prepared, here are a few red flags signifying real estate title fraud:
Different Signatures: Do any of the signatures appear different from the rest? This could signify that a forged signature was used. Double-check this, as it could prevent rightful title transfer.
Powers of Attorney: Attorneys are required for many stages of the home buying and selling process, however, if they seem to be abusing their power, it could be a bad sign.
Quiet Buyers or Sellers: It is always a good idea to meet the person you are selling a property to or buying a property from. If this person is avoiding phone calls or face-to-face communication with you, it should be concerning.
Failure to Provide Proof of Clear Title: The purpose of a title search is to make sure that a seller is the rightful owner of the property and there is no one who has a lien or claim on the property. Do not trust that a person has clear title until you see the proof from a title search.
Pre-Signed Documents: Since the home buying and selling process involves a significant amount of finances and you want everything to go as smoothly as possible, make sure all documents are signed in person. When documents are pre-signed, they have the potential to include fraudulent signatures.
The Importance of Verbal Confirmation
When handling payment, always make sure to give wire transfer instructions in person or over the phone. If you send these instructions via email, there is a risk of a hacker posing as either the buyer or the seller. In this instance, the hacker would instruct the other party to send the money to a different address. There is a chance that the other party could sense something wrong here before wiring the money to the hacker. However, if they don’t, then this would result in wire fraud.
The Best Protection? Title Insurance
One of the major benefits of getting title insurance is the fact that it can protect you from title fraud and other unfortunate situations. Mortgage lenders will require you to buy a loan policy of title insurance, which would also protect them from any losses.
Got more questions about title insurance? Visit our title insurance page on our website here, and contact us today if you need further assistance. At Hall & Runnels, we take pride in going the extra mile for all those we serve, including those who depend on us for our legal expertise regarding real estate ownership in Florida.
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