Fraudsters and scammers are getting more creative with how they can take advantage of people. Whether they be young or old, inheritors, or wage earners, many unsuspecting victims are left to pick up the pieces from the fallout of having to deal with bad actors. Two of the many types of fraud to be aware of, especially if you are a homeowner or own multiple homes outright, are title fraud and mortgage fraud.
Real estate fraudsters go about their practice as other identity thieves. They will gather sensitive information on their target, pull credit bureau reports, and forge state or federal documents. Once they feel they have enough critical information, they will proceed to impersonate the victim and either sell the house to unsuspecting buyers using a counterfeit deed or gain access to the house’s equity.
“Why would a fraudster do this?” you may ask.
Reason 1: If they can create a counterfeit deed to a home, they can pretend to sell it to potential buyers. Once the buyers put a down payment on the home “for sale,” the scammers will then disappear into thin air.
Reason 2: The culprits will submit a mortgage application in your name. If they are savvy enough to defraud the lender, then they can leave you sitting there trying to clear your name.
According to The Wall Street Journal, inheritors are particularly vulnerable to real estate fraud. When you inherit property, you may not be immediately familiar with all the aspects of the estate, making it easy for fraudsters to exploit the gaps in your knowledge or target properties that are in transit. For example, the Elvis Presley estate, better known as Graceland, was in the news recently regarding foreclosure and forced sale of the mansion. This was due in part to fraudsters fabricating various documents and pretending to be people they were not. Thankfully, Lisa Presley’s surviving daughter and her legal team prevented the scammers from succeeding in their scheme; however, this left her with many legal fees and hours of unwanted stress.
Thankfully, there are steps that you can take to prevent being a victim in a real estate fraud scheme. According to the state of Colorado’s Department of Regulatory Agencies, the three best ways to protect you and your family include:
- Protect and monitor your identity and credit.
- Obtain title insurance, which protects buyers against defects in the title, such as liens, fraud, and forgery.
- Be suspicious if you receive communications, emails, or texts requesting information about your property.
In order for you to maintain protection and peace of mind, vigilance and taking the proper steps are key. If you are not sure that you have taken all the steps needed, or if you need further help with staying diligent, clients of The Wealth Conservancy are always welcome to reach out and seek guidance from their advisor. If you are not a client, but you are interested in learning more about how The Wealth Conservancy can help with the complex aspects of an inheritance, please give us a call, or submit a consultation request to speak confidentially about your specific circumstances.