Protecting yourself from title thieves
Dear Mr. Feichthaler:
In the county of Lee and/or the state of Florida is home ownership protected from title thieves? Does my original title insurance protect me against title thieves? There has been a lot of TV advertising about this subject which puts a question in my mind.
— Byron L.
Dear Byron:
The commercials for “title lock” services have become more and more prevalent, so I expect many consumers have taken these companies up on their offers. Do these services really prevent deed theft? Although there are several methods fraudsters use to take advantage of unsuspecting homeowners, the general scheme is for the perpetrator to find a house that is not the owner’s primary residence. Often, these owners will be from out of state, or even outside the United States. That person then prepares a deed and uses either a complicit notary, or prepares fake documents to trick a real notary. That new deed will, on its face, transfer ownership to the improper party, who will then seek to sell the property soon after.
The services you see on television cost around $150 – $200 per year. Although they will monitor the public records for activity against your property, title lock services are not insurance. Also, it does not stop a scammer from recording a deed on your property, it just informs you that it happened. So, in reality, your title isn’t “locked” at all, and the use of the term is deceptive, in my opinion.
There is a very easy way to be informed about this activity, and it is free. The Lee County Clerk of Court offers a free service, aptly named “Fraud Alert,” which can be accessed on the clerk’s website. After enrolling, you will be notified immediately any time a deed or lien is recorded against your property. I have personally enrolled and it really works.
If you are ever the victim of deed fraud, you should immediately contact an attorney to stop any damage from occurring, like a sale to another owner. A timely response will greatly reduce the potential time and cost to reverse the issue.
You asked whether your original title insurance policy will provide protection if a scammer records a fraudulent deed, and the answer is no. Title insurance, which is an important part of any real estate purchase, insures that you have clear title at the time of acquisition. Your title insurance will not be valid for purposes of reversing a fraudulent deed. The good news? Attempted title theft is incredibly rare, and will be unsuccessful if you sign up for Fraud Alert. This eliminates the need for signing up for a pay service that will likely provide no additional benefit.
Eric P. Feichthaler has lived in Cape Coral for over 35 years and graduated from Mariner High School in Cape Coral. After completing law school at Georgetown University in Washington, D.C., he returned to Southwest Florida to practice law and raise a family. He served as mayor of Cape Coral from 2005-2008, and continues his service to the community through the Cape Coral Caring Center, Cape Coral Museum of History, and Cape Coral Kiwanis. He has been married to his wife, Mary, for over 20 years, and they have four children together. He earned his board certification in Real Estate Law from the Florida Bar. He is AV Preeminent rated by Martindale-Hubbell for professional ethics and legal ability, and is a Supreme Court Certified Circuit Civil Mediator. He can be reached at eric@capecoralattorney.com, or 239-542-4733.
This article is general in nature and not intended as legal advice to anyone. Individuals should seek legal counsel before acting on any matter of legal rights and obligations.