Friday, June 19, 2015

No Immunity From Deed Scams North Of The Border; One Title Underwriter Estimates Title Hijacking Damages Range From $400 Million To $1.5 Billion Annually

On Katepwa Lake, Saskatchewan, Yahoo Canada Finance reports:
  • Fred Weekley knew something was amiss when he received a fax from a title transfer firm wanting a land description of his home on Katepwa Lake, Sask., about 100 kilometres east of Regina. The mayor of the district of Katepwa Beach called the Vancouver-based company and was told the house had been sold and the title was about to be transferred to its new owner. The catch? He’d never put his home on the market.

    He was about to be duped. Weekley was just lucky he caught it in time before the transfer went through. “You can very easily be in real trouble,” says Weekley, a former senior financial planner. “You don’t even know what’s happened until the truck pulls up with the new owner’s stuff. It can be really, really disastrous.

    “To me it appeared to be a ‘big city’ problem, particularly where there are hot real estate markets,” he adds. “Now I know that the title fraud can happen anywhere and to anyone.”

    An all-too common scam

    Title fraud is becoming increasingly common. According to title-insurance company FCT (First Canadian Title), estimates of damages in Canada range from $400 million to $1.5 billion every year. In 2013 alone, the firm declined to insure a mortgage twice a week on average based on the suspicion of fraud; the average mortgage was $360,000.(1)

    Toronto, Calgary, Vancouver and Montreal have higher rates of fraud, according to FCT’s Retire Your Home website. Targets are typically seniors who have paid off their homes.
    How does it happen?

    Title fraud can happen in one of two ways, according to the Financial Consumer Agency of Canada. With identity theft, fraudsters can use stolen or fake identification or documents to pretend to be a homeowner and obtain one or more mortgages on the property, then walk away with the cash.

    Fraudsters can also register forged documents to discharge any existing mortgages then transfer the property to themselves and register a new mortgage against the property’s clear title, pocketing the proceeds.
For more, see Title fraud: Stealing your home from underneath you.

(1) According to their website, First Canadian Title offers a title insurance policy that, unlike traditional insurance products, also insures against things affecting one's title that may happen after a home purchase (e.g. title fraud), in addition to what title insurance normally covers - title defects that have already occurred in the past, prior to a home purchase.

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