Deed Fraud

DEED FRAUD

We are working with a seller who inherited property from a relative. It still has to go through a court process to finalize the inheritance (probate). The property is still in the relative’s name. It was headed to the Tax Deed auction until the seller paid the property taxes the day before the auction. A couple of hours later, a Quit Claim Deed recorded in the public records allegedly signed by the dead relative the day before. We were all shocked at this. The woman has been dead over 10 years so this was obviously fraud.

Deed Fraud has become so widespread and common that many people call it “the new identity theft”. Before running straight into deed fraud let us discuss what it is and how you can avoid it.

Deed fraud is when an individual(s) forges the identity of someone else and transfers the latter’s property into their name. It has become a huge problem in the real estate market in recent times that most counties and states have put in measures to combat deed fraud. However, every individual is responsible for their property and should be able to take additional measures to avoid having to fall into any sort of problems.

You might wonder how scammers and fraudsters would get your information to even be able to execute a scam on you, well this is sad but an Equifax breach which occurred in early September 2017 exposed sensitive information of as many as 143 million Americans. This information includes your social security number, driver’s license number, date of birth and your signature if you have ever signed a deed which has been publicly recorded.

With all of this information, anyone can proceed with a quit claim deed since they already have your signature and private information. If you have no idea how a quit claim deed works, here is a brief. Since a quit claim deed does not require a sale of the property, most states such as Florid require a notarized signature of the person transferring the property and the signatures of two disinterested witnesses. If someone goes to a county recorder’s office with a properly filled out and notarized deed, the recorder’s office has no choice than to record the document and just like that you have lost your property. Kimberly Soto, an Altamonte Springs real estate attorney with the Soto Law Office, says “Fraudulent deeds become a cloud in the chain of title which a lawsuit is needed to cure.” She says check the property appraiser’s records for your properties regularly.

Here are some things you can do to avoid deed fraud.

  • Make sure you register all property under your possession to court clerks and companies who specialize in alerting the owner if a scammer is trying to get possession of your property. Most of these services are offered for free. Many local county governments have information their websites to help you do this. In Orange County the Comptroller has entire page on Property Fraud.
  • Keep an eye on your vacant properties, make sure to visit your vacant property at random times and keep its surroundings neat and in good condition. Check the doors, windows and locks.
  • If you do discover that you are no longer the owner of your property because you have been defrauded, you may have to file a quiet title action or a court action to establish that you are the legal owner of the property.
  • If you are in possession of a property left behind by any family member or friend, treat it like it were yours. Many scammers and deed fraudsters scour through obituaries to see if there are properties available for them to forge the deed.
    Address any correspondence that comes to you which has legal implications. Most payment books and other information from a bank or mortgage company can be an indication of some illegal activity going on.
  • Never sign your deed, even if you do sign it, make sure you keep a copy of what signed.
    Never sign a blank document.
  • Take a look at your yearly tax bill. If you do not receive it make sure you find out why.
    If you are helping elderly relatives, ask the tax collector to send you copy of the tax bills each year. There may be a small fee for this service.
    Report fraud to law enforcement.

Whenever you are trying to buy a new property, make sure you verify the owner of the property and the authenticity of the deed they present to you. That is why Realtors and Title Companies are important, if you do not have time for this, they can always find out such information and any other troubles that might come with a new house.William Frazier, a Jacksonville area real estate attorney with Romanello Goode, says “ If someone is on your property unlawfully, start with the non-emergency police number and see if the authorities will move them on.” He also cautions they have seen a lot of REO’s “sold” by scammers claiming to be bank representatives.

As for the woman returning from the dead to sign the quit claim deed I told you about earlier, we are still trying to untangle this situation so we can buy the house.  Now in addition to the probate process the family may have to spend thousands to clear up the title before we can close.

Sandra Edmond is known as the Queen of Tax Deeds & has been a full time Investor since 2004. She specializes in buying tax delinquent properties. Prior to Real Estate, she was a Television News Reporter and Fill in Anchor. She’s a UCF graduate and is aCentral Florida Realty Investor past President and Lifetime member.  Sandra is a licensed real estate broker-associate with Matrix International Realty.

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