There’s another aspect of the mortgage crisis that few people talk about and that’s identity theft. While there is a definite rise in foreclosures as of late, there is also a rise in mortgage fraud via identity theft. Two ways that this can occur are through unscrupulous people who pose as lenders or buyers using information that isn’t theirs and through thieves who steal other people’s personal information to perpetrate elaborate mortgage scams. These thieves sometimes steal people’s homes right out from under them.
It’s bad enough to have an identity thief make a few charges on your credit card. Can you imagine if that thief bought an entire home in your name without your knowledge? It’s not that common, but it does happen. A woman bought a $419,000 townhouse in Fairfax County, VA in 2007 and was successful in obtaining not one, but two mortgages in someone else’s name. In another recent case, a real estate business owner took over more than 100 people’s mortgage loans to “help them make the payments.†Instead, she ended up selling the homes to fake buyers and not making any payments, jut collecting the people’s money.
Another scam is called “house stealing.†It happens when a thief transfers a deed for someone else’s home to his or her name or that of an associate. Some homeowners; well, now ex-homeowners, still live in the homes in question and pay on the mortgage, having no idea that their homes no longer officially belong to them. Thieves also target second or vacation homes since this can help them keep up their scams for longer.
If you’re a homeowner, you may be wondering what the point of learning about these scams is if there’s nothing you can do about it. Luckily, there is something. It’s called an identity theft protection plan. Constant monitoring of your credit reports can help you to determine is someone has taken over your mortgage and has quit making the payments. A public records search, which many plans include in their basic service, can let you know if your deed has been transferred to another party without your knowledge.
What else can you do? One big thing is keep your personal information off the Web. Don’t include your first and last name and address when trying to rent out your vacation home. Instead, simply provide a phone number or email contact. To be even safer, compose a simple online form so you get interested parties’ information without having to shell out yours. Once you have a confirmed renter, you can give out your details at that point.
It’s a sad day when you can only be pretty sure that the home you’re paying on actually belongs to you. Though, since it’s a reality, it has to be dealt with. Be proactive instead of reactive and you should be okay. Ask your lenders to contact you immediately if they notice anything strange with your bills. According to federal law they should do that anyway, but, if you haven’t noticed in the news of late, sometimes large corporations need a little prodding to do the right thing.
You may also want to look at an identity theft protection service such as LifeLock or TrustedID as they include public record searches as part of their service.