Behind Their Backs: The Pain of Finding Out About Malicious Deed Transfers

From time to time, we talk about deed theft here.

But what actually happens, from the deed holder’s point of view?

Here’s what it’s like — and how to protect your deed.

Judge Confirms Fraud. So, Where’s the Deed?

A homeowner finds out her deed has been swiped, and goes to a court seeking help. Upon receiving a five-figure bill for back property taxes, she knew she had to make a stand and try to recover her home.

The judge declares that a criminal faked a signature to quitclaim the home, gaining legal control of it.

The fraudster asked the Montgomery County Recorder of Deeds to record the deed under a new name. The name of an LLC. And yes, an official went ahead and recorded the bogus deed. Unless a state’s law says otherwise — look at Georgia’s deed recording law, for example — county Recorder of Deeds officials lack authority to check for possible fraud before recording deeds.

Now, even though the judge has awarded the property back to the rightful deed holder, the deed snatcher’s lawyer has filed a motion to put the case on hold. At this time, the victim can’t get a deed transferred back into her name.

This is the horror that is deed theft. We wish we could say it’s a rare fluke. According to the FBI, criminals committed about 10,000 deed theft crimes last year alone.

As Costs Build Up, Friends Offer Condolences and Support

A group of residents in Dayton, Ohio got together earlier this year to hold a brunch and fundraiser at a local library.

The recipient of the funds is the person we’ve just mentioned. She’s a recent lung cancer survivor. She has a pile of medical bills. And her deed was taken by deed theft.

The exhausted grandmother says fighting for a deed takes a heavy mental and physical toll. Here’s her experience:

• Getting a lawyer is costly. Often, legal expenses force victims to request financial help from others.

• Courts are costly. Courtroom and related costs are now up into the five figures in this case.

This case is now well known in Dayton. The victim set up a GoFundMe page to help pay for her legal battle. She needs a lot more help, and it’s been a year and a half since the deed was taken.

By Hook or by Crook: How Home Thieves Get Into a Deed Holder’s Business

Bad actors sometimes choose quitclaim deeds to transfer homeownership to themselves (or their companies) behind the legitimate deed holders’ backs. 

Or they steal homes out from under heirs when a person dies.

This is why homeowners should have an up-to-date will. Alternatively, in most states, they may fill out a transfer on death deed form specifically for real estate. These simple deed forms let homeowners designate who gets the home when they die. This offers some protection against deed scams after an owner has passed on.

To create their dirty deeds, bad actors use several methods:

• Forgery. The bad actor fakes the real homeowner’s signature on a deed and has it recorded in the county. This is a common method when a deed holder dies.

• Fraud. The bad actor persuades a vulnerable deed holder, perhaps an older person, to sign over the deed.

• Exploitation. A swindler might be asking for upfront fees (red flag!) promising to help a struggling deed holder get a mortgage modification.

These are all causes for state law enforcement to get involved. In addition to forgery and fraud, prosecutors charge deed tricksters with serious crimes such as grand theft and tampering with government records.

But prosecution doesn’t necessarily fix a victim’s troubles. Even with a lawyer, getting a deed back can take years. Obviously, the deed pirates need to be deterred in the first place. This is why states like New York and Michigan are creating new laws that include deed theft among their serious crimes. 

Transfer on death deeds are alternatives to passing homes through wills. The homeowner should record the form in the home’s county. The TOD deed is revocable during the homeowner’s life — and ends automatically if the home is sold.

Innocent Victims: Who Gets Swindled Most?

In the Dayton area, bad actors have preyed especially on people who are struggling financially. The Montgomery County prosecutor announced in November that a pair of forgery artists used quitclaim deeds to transfer multiple homes this year in Dayton and surrounding suburbs. The pair used an LLC named Love Has Homes to receive the deeds. Then the couple reportedly attempted to disrupt the lives of other people too, by marketing their ill-gotten deeds at discounted prices to innocent buyers. The couple was arrested and jailed in October.

Deed theft can happen to anyone, to any home. Yet the easiest people to target tend to be:

• Owners who are absent from the homes. Some of them have moved into nursing homes, and no one is looking after their assets.

• Owners who lack the means to pay off liens and now face foreclosure. Look out for shady actors who ask for the deed, promising struggling people they’ll be able to get their homes back later.

• Immigrants and people in minority communities.  

• Seniors who have paid off their entire mortgages. Then, there’s no mortgage company looking over the owner’s shoulder. And deed thieves like a home that’s free of a loan obligation.

• Buyers who accept a quitclaim deed in return for their money. A company or someone else (outside of the buyer’s family) wants to unload a property with a quitclaim? That’s a red flag.

• Families of homeowners who have died.

On that last one, yes, thieves will even victimize dead homeowners. They have no qualms about stealing from heirs who don’t go through probate to legally transfer the deed.

Don’t Let It Happen: Tips to Foil the Perps

The Office of the New York State Attorney General offers a number of solid tips to avert deed theft:

• Get your own attorney to advise you before you transfer your deed or homeownership over to someone else.  

• Write your will (and go get it witnessed and notarized according to your state’s legal rules).

• Read documents, and don’t sign contracts you’re not sure you understand.

• Stay current with your mortgage, property taxes, utilities, and other home-related payments.

• Check on your deed.

The last tip might be easier than you think. Your county might have an automated notification system you can sign up for. To find out, visit the Recorder of Deeds website. Look for the “fraud alert” email system. If the system ever sends a message saying someone has made a claim on your deed, you could report a fraud before the perp sells the home.

And spread the word. Together, let’s keep our homes safe.