Nobody expects to become a victim of title fraud, but the fact of the matter is that it occurs more often than many would like to admit in the United States. Scammers are getting better at taking advantage of unsuspecting property owners, and you need to be aware of what you can do to protect yourself from real estate fraud if you own or are considering acquiring commercial property. In today’s blog, we talk about some of the ways you can protect yourself from title fraud.
How To Stay Safe From Commercial Title Fraud
While title fraud can occur in many different ways, here’s a look at how the scam can proceed:
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A scammer identifies a property that they want to acquire. Oftentimes they look for easy targets, like vacant property or undeveloped land.
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The scammer creates a fake deed that suggests the title has been transferred to them, or they may attempt to steal the property owner’s identity in order to fraudulently transfer the property to themselves.
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The scammer takes the deed and files it with the county.
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The scammer then either attempts to sell the property or they take out a home equity line of credit loan against the property.
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The actual property owner may not realize fraud has been committed until the bank begins to foreclose on the property or another party who believes to have legitimately acquired the property begins to develop the land.
Again, it seems highly improbable that it would progress to this stage, but if you are managing a number of properties, especially if you don’t live in the same area or even the same state, you may not know that someone is working in bad faith against you until it’s too late. It’s not your fault that the county accepted a fake deed, but it absolutely will be your mess to clean up, so do what you can to protect yourself from title fraud.
So how can you work to prevent commercial title fraud? For starters, it’s imperative that you have title insurance. At the very least, if someone makes an illegitimate claim to your property, and gets way further along with the process than you expect, your financial interests will be protected. It will still be a headache, but you will have an army of professionals in your corner who can not only help to catch fraud in the act, but give you financial peace of mind in the event any fraud is attempted.
Aside from working with a company like Commercial Partners to secure title insurance for your property, some tips to keep in mind include:
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Regularly check your credit report or subscribe to a credit monitoring service.
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Take measures to protect sensitive information, both in the real world and on the web.
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Don’t throw out any mail or correspondence in regards to your property without thoroughly reading it over.
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Consider calling your county deed office each year to ensure there is no expected activity related to your property.
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Hire a third party to regularly check on the property if you are not able to check it yourself on a consistent basis.
Scammers prey on people who just assume the best of others, and if you just do a couple of the tips mentioned above and protect your property with title insurance, you’ll be doing more than most property owners and you’ll be able to stop fraud at the outset. For more information about title fraud or protecting your commercial interests, reach out to the team at Commercial Partners today at (612) 337-2470.