One of the most important Real Estate stories you will read about this year is Real Estate fraud!March 4, 2023 3:54 pm
Last year 2 people impersonated a couple and sold their house in the GTA when they were out of the country! This couple profited from the sale and have disappeared, enjoying a life off of someone else’s lifetime investment. Click here to read the article. How could something like this happen? Well, Real Estate fraud is real and it happens more than is reported in the news. There are all types of fraud that deal with property and mortgages. Mortgage fraud is more prevalent than Real Estate fraud but it is important to understand your rights and how to prevent something like this from happening to you. The listing agent was convinced they were dealing with the rightful owners of the property because these 2 fraudsters were using fake identification and convinced the Realtor they were the owners of the property. There are many questions of how these fraudsters got hold of the sale proceeds which is a deeper story involving, I am sure, fraudulent bank accounts. How could the rightful owners protect themselves? 1. The first thing that comes to mind is if you are out of the country for an extended period of time is have a “go to” person who will look after the house, whether that is a family member, friend or a property management company. Property insurance companies require that a property they insure is occupied and not vacant. 2. Some homeowners are lucky enough not to have a mortgage but I suggest having a small mortgage on the property at all times is important because it helps prevent these types of crimes. Banks are a natural defence line against these types of frauds because they have a history with the real owners and in a situation like this would have reached out to the real owners using their original contact information regarding the sale of the property and the transporting or termination of the mortgage. Who gets to keep the house? The new buyers or the original owners? The consensus is the original owners would retain the property because the new buyers purchased the property through fraudulent means without being aware they were purchasing the property from people who did not own the property. What happens to the new purchasers and their funds? Title Insurance should cover the losses for the buyers and it would take quite a bit of time for the buyers to get back their investment. Your home is not just your home, it is a valuable lifetime investment and it’s always wise to protect this investment at all times: 1. Maintain a small mortgage to prevent fraud. 2. Title Insurance is important for properties with no mortgage. 3. Always have someone looking out for your property if you go away.