You may have seen the ads or heard the buzz about companies offering title monitoring services or “title theft protection.” Are they legitimate or just a scam? Is there any real value in these services?
First, let me clarify that “title coverage” offered by some of these unregulated companies is not title insurance. They do not actually protect you from fraud, title thieves, scammers, etc. Their standard service does include taking any actions regarding the rightful ownership of your property.
What is Title Theft Protection?
Monitoring services like Secure Title Lock and Home Title Lock offer subscriptions that say they will alert you to court filings affecting your home’s title. For $100-150 a year, they will monitor court records to show title fraud or theft. The “protection” they offer is basically a notification that someone has changed the ownership or deed to your property.
“Title theft” is a fairly new term that has generated a handful of companies feeding on consumer fears. These companies suggest that criminals can “steal” your property by forging your name on a deed, then resell the property or take out a mortgage loan against it. They claim a title thief can stick you with a debt that isn’t yours.
That simply isn’t true. Though a title thief or forger can’t actually steal your home, they could create a lot of headaches for a property owner. Proving and dealing with fraud can be time consuming and expensive. Title theft protection services are meant to be proactive in helping you shut down mortgage fraud.
The benefits of a title monitoring service are ambiguous. They are only designed to alert you to a change in your title. They don’t prevent the fraud and they don’t actually help you deal with it if it happens. A title theft monitoring service will not help to clear or correct a title. They have no legal obligation to assist the owner with a title theft and they don’t offer protection against financial losses. That’s what home title insurance is for.
What is Title Insurance?
Title insurance protects the owner and their lender from the possibility of someone contesting their ownership of a property. When buying or refinancing a home, you need a title insurance policy if you are closing at a title company or getting a mortgage loan. The title insurance premium paid at closing protects you for the entire time you own the property.
Title insurance not only protects you from financial loss, it requires the title company to legally defend you if your ownership is ever challenged. However, it insures against issues on the title when you purchase the property. It doesn’t cover future criminal incidences.
How to Protect Your Home Title
You don’t need to pay a company to protect you from thieves putting their names on your home title. You can easily monitor your title yourself for free. Just go to your county’s tax web site and periodically check your property record. Ensure that it shows your correct name and address.
If you discover that your property ownership has been fraudulently changed, contact an attorney. The county clerk at the property recording office can also advise you on filing a notice affidavit with the county court.
The opinions expressed are of the individual author for informational purposes only and not for the purpose of providing legal advice. Contact an attorney to obtain advice for any particular issue or problem.
