Posted by: Daryl & Wendy Ashby | June 26, 2010

Title Fraud

For those who know the intricacies of the real estate and lending markets, title fraud makes for fast and easy money. It typically involves fraudsters using stolen identities ro forged documents to illegally obtain a registered owner’s title. The fraudster then arranges a new mortgage on the property and disappears with the money.

The average real estate title fraud amounts to $300,000 and industry insiders estimate these scams are costing Canadians a total of between $300 million and as much as $1.5 billion each year.

Major urban centres, such as Vancouver, Calgary, Toronto and Montreal, are hotbeds for this criminal activity, but homeowners in any part of the country are at risk.

In the past six years, it is estimated that the dollar value of real estate title fraud claims in Canada has increased by approximately 550% — accounting for one-third of the monies paid out for real estate title claims.

In a recent Canadian case, the fraud became known when a rightful owner attempted to pay property taxes and was told that, according to municipal records, he no longer owned the home.

Another case came to light when a son attempted to sell the parent’s home and discovered someone else had already sold it fraudulently.

In yet another case, a woman received a call from mortgage collector saying she was three months behind on payment for a home she did not even know she owned. Later, she discovered two additional properties in her name with a total liability of over $400,000.

What can you do about this?

In the past, homeowners and lenders had few tools to guard against losses from real estate title fraud. This all change with the introduction of title insurance, pioneered in Canada in 1991 by First Canadian Title.

Title insurance shifts the risk away from the homeowner or lender to the insurer. Unlike traditional forms of insurance where there is a monthly or annual premium, title insurance involves a low-cost, one-time premium.

For more information, visit: www.firstcanadiantitle.com

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