House stealing may sound scary, but it’s actually quite rare.
Sometimes called mortgage deed theft or title theft, house stealing happens when a criminal uses forged documents to fraudulently transfer your property deed into their name. The scammer may then sell your property to an unsuspecting third party, pocketing the profits, or borrow against your equity to open a new line of credit.
While the FBI issued a warning about house stealing back in 2008, it remains an uncommon fraud type. When it does happen, it’s usually the result of identity theft.
Read on to learn more about the risks of title theft and how an identity monitoring service like ours can help you protect yourself and your assets — including the deed to your home.
How do mortgage deed scams work?
A key part of a house-stealing scam involves finding a house to target.
While any property could work, vacation and rental homes are particularly vulnerable. The homeowners are less likely to be physically present and may not be paying as much attention to bills and other notices that come in the mail.
Senior homeowners are also more susceptible. The elderly are generally at a higher risk for identity theft. Seniors are also more likely to have paid off a good chunk of the mortgage — which could equal more equity for a criminal to borrow against.
The other key ingredient is the homeowner’s personal details. This information can be pulled from a variety of sources: social media, the dark web, or even phishing scams. The goal is to assemble enough pieces of information — like the victim’s full name, Social Security number, and birth date — to falsify identifying documents, such as a driver’s license and Social Security card.
Using the phony IDs and forged signatures, the fraudster then files paperwork with the county’s recorder of deeds to transfer ownership of the property to themselves or to a third party.
The rightful homeowners may not find out about the scam until new “owners” knock on the door, or when the thief fails to make payments on a loan tied to the property and the home goes into foreclosure.
In most house-stealing scams, the fraudster never actually takes possession of the home. Because a forged deed is not legitimate, in most cases, the truth will eventually prevail. But proving the fraud to the proper authorities and recovering from any related identity theft can take time and resources.
Do you need title lock insurance?
Currently, there is no solution on the market that can proactively lock your home title the same way you can lock your credit.
While locking your credit actually makes it harder for someone else to open an account in your name, what’s advertised as title lock insurance is often just a deed monitoring service that alerts you if a deed has been transferred out of your name — after the damage has already been done.
In most counties, you can access this information for free online. Some local governments even offer complimentary property fraud alerts that call or email you whenever a document is filed that relates to your property.
Instead of paying for a dedicated title lock insurance, consider signing up for free alerts or using a more comprehensive identity monitoring service product like ours.
We’ve got you covered
If you’re concerned about title theft and you want to take a proactive approach, there are things you can do today — in our portal and online — to protect yourself.
Locking or freezing your credit is a good first step. While your credit is locked, any title transactions will be impaired.
In our portal, you can check your credit score and view your credit report. If a criminal is using your house to power a new line of credit, they probably won’t be paying the bills on time, so pay attention to any sudden dips in your score or accounts you don’t recognize.
If an identity thief does steal your home title and you’re an Allstate Identity Protection member, you’ll never have to manage the recovery process alone.
Our identity specialists can take on limited power of attorney to handle tough remediation tasks — like contacting local law enforcement and filling out necessary forms, affidavits, and letters — on your behalf.
We’ll also reimburse up to $1 million of your out-of-pocket costs for fraud, including legal expenses.
In a house stealing scam, the deed may be forged, but the identity theft is very real. Luckily, so is our protection.