More Comments on Home Title Lock

 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.)  

More on Hometitlelock

I've gotten a couple calls concerning Hometitlelock since I wrote this blog post.  These people didn't read my post very carefully, because they thought I was Hometitlelock.  Not only am I not affiliated with them, I feel like I would be casting shame upon my family if I were.

You might be a victim of home title fraud, and you might be struck by lightning.  I suspect the odds of being struck by lightning are higher.  The due diligence procedures of banks and the requirements of notarization suggest that it is extraordinarily unlikely for you to be the victim of home title theft. 

Is Home Title Lock Legitimate?

I listen to satellite radio a lot, and I frequently hear commercials for Home Title Lock. (hometitlelock.com).

This is what Home Title Lock says on their website:

 Mortgage fraud is the fastest growing white collar crime in AmericaTitle fraud is when a thief uses a false identity and transfers your home's title to his name. He can take out a loan and stick you with the payments, he can change the title so he inherits your home and even have you evicted from your own home.
Title Insurance Doesn't Protect You and Neither Does Your Bank or Identity Theft Protection. HOME TITLE LOCK DOES

I have been a consumer lawyer for almost 30 years. During a lot of those years, I did 3500 intakes per year from everyday people with a huge variety of legal problems, and in that time I NEVER encountered a single complaint of home title fraud BY A STRANGER.  

I saw cases of home title fraud, but then involved relatives or "we buy homes" scams (usually involving sale/leasebacks), I also saw many cases of mortgage fraud by mortgage brokers in the bad old days prior to mortgage meltdown in 2008: 

I would like to see the data that Home Title Lock relies on to say that mortgage fraud is the fastest growing white collar crime in America. Also "Title fraud" and "Mortgage fraud" are not the same thing.  There are a whole lot of types of mortgage fraud, and as far ask I can tell, most types went into sharp decline after 2008 when lenders got more picky about their mortgages - and regulators enforced more due dilligence.  Title fraud, in my experience is very rare and usually involves confidence scams by no-money down real estate types, Usually the homeowner actually does sign title documents but under false pretenses.  

I don't really do consumer mrotgage cases anymore, but I am in contact with fellow consumer attorneys that do. Most of their time is spent on cases involving improper mortgage servicing (for example: failure to credit payments properly) and improper fees.

Here's why I think the type of deed fraud Home Title Lock scares people about is exceedingly rare: It takes multiple stages of fraud to pull off, and there are multiple chances of getting caught each time.  Let's look at the initial fraudulent deed.  The owner's signature has to be forged, and there has to be a fraudulent notarization.  A pattern of fraudulent transactions involving a single registered notary would be detectable by a  state notarization board and maybe a title insurance company.  The deed has to be transferred to a transferee who is either in on the scam or is a "straw buyer".  There are lots of scams involving "straw buyers" and they are relatively easy to track.  These tra"innsactions almost certainly would have to focus on properties where the deed owner is not in possession. Why, when the "innocent" third party buyer paying money to the scammer tries to take possesion, they will see the real owner. The real owner can defend against the "innocent" purchaser. In short, if your deed is forged, you have the chance to prove that in an action against the person who pays the scammer.  The person who pays the scammer, may be able to sue the title insurance company that closes the sale.  So I just told you that t the smart scammer will target properties that are not owner-occupied. - BUT THAT'S NOT WHOM HOME TITLE LOCK IS TARGETING. This company is targeting ordinary homeowners who live in their homes.  Now at the closing with the innocent purchaser putting up money, the only way the scammer gets paid, the scammer has to present id that is suitable for notarization.  You have to generate a fake identity for every deal you close. That's a lot of work.

In my opinion, it is not a good investment to pay Mortgage Title Lock $9.95/month to protect your home title. I think they are selling fear to gullible (often elderly) targets.  I don't have any legal action against this company, nor am I planning any.  Hopefully, they won't be into most of their customers more than about $100 before the customers realize that maybe there are better ways to spend money.

So to answer the question I posed in the title, is Home Title Lock legitimate?  Well, I don't have any reason to doubt that they monitor public records, so to that end they probably are legitimate. On the other hand, I have my doubts about the scope of the problem that they claim to be guarding against. That's why I wouldn't give the company any of my money.