In the past couple of years, I've gotten calls from a couple of reporters who started an investigation into Home Title Lock. It is likely the most recent investigation was snuffed out by the (then new) pandemic. I heard my first commercial for them in a long time, and I think things are about to heat up. In addition, I saw this article on the Quicken Loans site that sure seems to me to read more like an advertisement than a journalistic piece.
What I find interesting is that this article includes the first statistics I've ever seen in discussions about this problem. According to the article:
"According to the FBI, 9,600 victims lost over $56 million in 2017 due to real estate and rental fraud. There are not specific numbers on home title theft, but many see these schemes as a fast-growing area of cybercrime."
Now let's assume these numbers are true. My argument has never been that home title fraud NEVER happens. My argument has been that it is REALLY RARE. As this quote points, out these are NOT numbers specific to home title theft, but to all areas of real estate and rental fraud. In my 34 years as an attorney, I have seen a number of cases involving real estate fraud, but none of them has involved forged title documents by a stranger. The most common fraud I've seen is the "we buy homes" scam. You've probably seen the signs on a telephone pole near you. The thing that disqualifies this scam from what Home Title Lock touts is, typically, the deeds and other documents are actually signed by the real owner, but under the misrepresentations of a con-artist. The other common real estate fraud that I've seen is a relative or other trusted person using undue influence or misrepresentations to con an elderly or incompetent person into signing a deed. Home Title Lock won't help in these situations, either. Rental fraud? I've seen people without even any documented claim of ownership of a property pretend to be a landlord and rent it out. In addition, there is a form of mortgage fraud that the victim is the mortgage company rather than a homeowner and that is a "straw buyer" fraud. I haven't seen this fraud in at least 15 years, but it was big before the Great Recession.
The bottom line is that I am guessing the number of cases that fit the description of Home Title Lock's advertisements is closer to 96 than 96 thousand, and if I'm right, the odds of you being a victim really is one in a million. Note the odds of being struck by lightning are twice that, about 1/500,000.
By the way, I'm apparently not the only person who thinks the problem described by Home Title Lock is overblown. I ran across this interesting blog post by attorney Nathan Hannah from Arizona. Attorney Hannah's also seems suspicious that the actual problem of title theft by forged deeds is rare, and he also analyzed a common title insurance policy and determined that it might cover such events anyway. Also, whether or not it does, identity theft coverage through a homeowners' policy just might.
(The subject of identity theft coverage in homeowners' policies opens another whole can of worms, one which might be the subject of a blog post later. My limited personal experience with it leads me to believe that it is hard to make use of the coverage even when you are a victim of identity theft. A few years ago, I talked to a big table of consumer lawyers who do Fair Credit Reporting Act cases for consumers, and I asked if any of them had ever received a referral from an insurance company under an identity theft policy, or if they were ever retained to work for a consumer on an identity theft issue, and none of them had. I just haven't seen evidence of an insurance company ever actually doing something for a policy holder on an identity theft case.)
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