Why You Should Offer Home Title Fraud Protection

Key and House Keychain Laying on Top of Title Deeds Document

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Home title fraud — also called deed fraud — is a significant fraud that may not hit the masses, but the cost is major. In the 2023 Internet Crime Report, the FBI received nearly 10,000 real estate-related complaints. While that may not seem significant, those crimes cost consumers more than $145 million in terms of losses — that’s more than the monetary loss to identity theft, extortion, ransomware, malware, and other types of crimes.

As a home title company, real estate professional, lender, or insurance carrier, you are a trusted advisor throughout the entire lifecycle of a homeowner’s journey – your role and relationship with clients do not end at closing! You are often your clients’ first call when financial concerns — or abnormalities — arise. But don’t worry. There are tools and resources you can provide your clients to help them avoid personal and financial data compromise. Read on to learn ways to help protect your clients now and in the future.

Key Takeaways

Home title theft is a significant hassle you can help your clients avoid. Fraudsters will use your clients’ stolen information to wreak havoc on their lives, including forging deeds, withdrawing equity on your clients’ homes, etc.
There are existing homeowner’s policies and services from other solution providers that do not include title monitoring or fraud resolution. Some may promise a title “lock” mechanism that doesn’t fully protect your client’s home title from theft or fraud. More on this later in the blog.
Iris’ Total Title Protection package provides maximum protection for what matters most to your clients – their properties and their identity. Unlike any protection program in the market today, Iris’ Total Title Protection combines key products and services for homebuyers in one place, helping to protect them against home title theft, scams, cyberattacks, and identity fraud.

Home Title Theft: What Is It & How Does It Occur?

Whose Line Is It Anyway

Whose Title Is It, Anyway?

Fraudsters rely on sophisticated social engineering tactics as well as common identity theft attempts to commit home title theft and fraud. These tactics include phishing, dumpster diving, and data found from previous data breaches. However, according to CertifID’s 2024 State of Wire Fraud Report, real estate is especially vulnerable to fraud for multiple reasons:

Data Availability. Data on property listings is publicly available via MLS and county records. Therefore, fraudsters can fairly easily find and leverage this data to commit fraud.
Large Sums of Money Involved. Transactions involve large sums of money and can have a lucrative payout for the fraudster. From the thieves’ perspective, it’s a low-risk / high-reward situation.
Multiple Entry Points. Typically, up to 10 different parties are involved in and share information about the closing, providing multiple avenues and mechanisms for thieves to exploit.

Whose Problem Is It, Anyway?

Title theft is a problem that affects everyone involved in the real estate business. According to CertifID, one in 20 Americans who bought or sold a house in the last three years was a victim of real estate fraud. As a professional who knows the ins and outs of paperwork and the multiple steps needed to buy (and sell) real estate, you know the hours of hassle, stress, and wasted time involved in title theft are significant to both the client and those working with them.

For the real estate industry, in particular, fraudsters impersonate themselves to target:

Buyers. The thief impersonates the title agency and provides fraudulent bank details so that the buyer can wire funds to an alternate account. The buyer is often unaware of the fraud until days after wiring the initial funds.
Sellers. The thief gathers the personal information of a property owner and files a fraudulent listing on their behalf. The buyer then pays the thief only to end up without their money or property. Last year, 77% of real estate professionals saw increased seller impersonation scams.
Title and Law Firms. The thief may impersonate a lender and provide mortgage payoff or downpayment instructions during closing, meaning the funds go to the thief instead of the proper company. The buyer or seller is then left with a feeling of distrust toward their lender or title firm, potentially leading to client attrition and damage to the firm’s reputation.

Once a title is acquired, the thief can wreak additional havoc by:

Selling the property
Forging fraudulent deeds
Renting the home out if it’s unoccupied and collecting the rent
Withdrawing home equity
Refinancing the mortgage
Taking out additional loans against the property
Opening fraudulent home equity lines of credit (HELOC)
Committing additional identity theft

For instance, Graceland, Elvis Presley’s iconic Memphis home and a much-beloved piece of American history, was nearly auctioned off when scammers fraudulently claimed they had rights to the property. Of course, that wasn’t true; however, the owner, Elvis Presley’s granddaughter, had to sue the scam company to protect the estate from going to auction.

What Can You Do to Protect Your Clients from Home Title Theft and Identity Fraud?

Your clients’ prosperity is a top priority for them — and for you. Home title theft is not just about ownership and wealth; it’s about their identity and well-being. Often, your clients are so overwhelmed with financial considerations that they may not be thinking about the need to also protect themselves against identity theft during this process. In their mind, they have YOU to help protect them!

Although there are a variety of policies and services that offer coverage for various title issues, they don’t often include enhanced home title and identity fraud services or resolution assistance. For instance, there are owner and homeowner policies that cover buyers who fall victim to pre-purchase forgery. For companies in the 46 states where regulators have approved these enhanced policies, 42% of customers, on average, chose policies that protect their property from forgery, including seller impersonation fraud, in the future. While these policies offer consumers some protections, consumers – your clients – still want to avoid the hassle, stress, and wasted time and money spent attempting to resolve the fraud incident. These policies will reimburse the consumer later; however, consumers still need to pay out of pocket and wait for the reimbursed funds.

Another service, Home Title “Lock,” is supposed to monitor the deed to your client’s home to see if it’s been transferred into someone else’s name. The service will notify your client if this has happened. However, it does not actually “lock” their title to prevent fraudulent deed or home title transfers. There really isn’t a way to “lock” a home title. Unlike credit, there isn’t a centralized database that can lock or freeze a consumer’s home title to help protect it from fraudulent use.

Iris is going beyond your standard title monitoring or this concept of a “home title lock,” which is a misnomer we’ve seen among many of the products on the market that look to address real estate fraud currently. Since titles get recorded all throughout the country in local courthouses, there’s no centralized database that can be “locked” like there is with credit. Our home title solution monitors home title changes from thousands of county recorders offices across the country and sends alerts when we detect activity that could indicate fraud. In addition, our package includes a comprehensive suite of services to help protect the homeowner and resolve issues related to identity theft, scams, and cyberattacks, along with up to $2M expense coverage for identity theft or home title theft incidents.

Michele Krisanda, SVP of Global Product Development

So, if there’s no way to “lock” your client’s home title or deed and existing policies don’t include ongoing home title monitoring, what else could you do to help protect your brand and your clients from data compromise?

Educate Yourself and Your Brand. According to CertifID’s State of Wire Fraud Report, more than half (51%) of consumers were unaware of the risks of real estate fraud before closing. Your clients are looking to you for educational awareness about the risks and total protection for their home title and identity.
Secure Your Technology. The last thing you want is for your platform to be the entry point for a fraudster to obtain information about your clients. Ensure your security software and data policies are updated to help safeguard your client’s personal information.
Verify the Seller. According to the American Land Title Association (ATLA), seller impersonation is a growing problem. Last year, 28% of title insurance companies experienced at least one seller impersonation fraud (SIF) attempt, and 16% of title companies paid claims on transactions involving SIF.
Protect Your Clients Most Valuable Assets – and Yours! Iris’ Total Title Protection monitors your client’s home title and identity data and alerts them if their personally identifiable information is found on hacker dump sites, black markets, hacktivist forums, file-sharing portals, etc. If fraud has occurred, we have 24/7 fraud resolution specialists to help resolve the issue on their behalf. By integrating identity protection, home title monitoring, scam analysis, and award-winning fraud resolution assistance with your existing services and fees, you can help address your client’s fears, and curb the negative impacts of scams leveraging your brand. Plus, when offering Iris’ Total Title Protection, our clients see upwards of $1.4 million in additional revenue with an offer of 40% revenue share back to them.

Total Title Protection from Iris: Maximum Protection for What Matters Most

While your clients may not have title theft at the forefront of their minds, as their trusted advisor, it’s important for you to think ahead and provide them with resources they can use in times of distress, including Total Title Protection from Iris. Plus, we empower you with an efficient go-to-market set-up via our OnWatch^® portal. You can also choose to integrate select solutions via API to provide your clients with a seamless client experience in your existing digital products.

Stand out with world-class protection services, all-inclusive account management, and ongoing partner marketing support from Iris.