Can Someone Really Steal My Home?

Can Someone Really Steal My Home?

Since today is Halloween I thought I’d lead with a scary question, and it’s one I hear a lot more often these days, especially now that your TV is filled with ads targeting homeowners with just that claim. Should you be concerned – yes. Should you be scared – no. Here’s what I can tell you:

1. Ownership of real estate in Michigan is established by a legal document called a deed. The seller/transferor of the property signs a deed that “transfers” his or her interest in the real estate to the new buyer/transferee. You can imagine the confusion and problems with these deeds if they get lost or destroyed. “Who owns the property” can become a nightmare without the deed. Enter the county Register of Deeds which keeps a record of all deeds that are sent to them for recording.  The Register of Deeds is supposed to review the deed for many things, including accuracy of property description and ownership. Staffing issues and electronic recording make the accuracy checks more challenging.
2. When you buy real estate you want to make sure the seller is legitimate. Enter title insurance, which is what a buyer pays for so that a title company covers the risk of a problem, like a prior deed that was improperly drafted or an undisclosed lien on the property. Title insurance typically covers the buyer up to the point of closing, but not too long after that. A fraudulent title transfer years after the sale will not be covered by the title insurance policy that covered the closing date.
3. So, can someone take ownership of your home without you knowing it? The short answer is no, not legally. But someone can claim to be you and forge your signature on a deed and then try to record it. Heck, in the world we live in anything is possible.

Before you start to sweat, know that while on the rise, fraudulent deed transfers are still fairly rare, and often happen with properties that are neglected. Still, there are things to know to protect yourself.

1. A new Michigan law (MCL 565.371) will help deter fraudulent deed transfers. It is now a felony to draft or record a deed with intent to deceive anyone about the validity of the document. In addition, the law empowers the county Register of Deeds to refer questionable documents to the county prosecutor for investigation.
2. You can check the status of the deed to your home by visiting your county Register of Deeds office to request the most recently recorded deed. Some Register of Deeds office (Oakland and Macomb, for example) also provide a very good online deed search service or a way to request a notice if a document is filed on your property or in your name. Check your county’s website.
3. An existing mortgage can make a deed transfer more challenging because the mortgage is recorded and a payoff and release is typically required on a deed transfer.
4. Real estate ownership usually has bills associated with the property, including utilities and property taxes. If you stop getting bills or see a different name on the bill, you should look into the matter.
5. Of course, the big question people want to know is should they pay for some type of title monitoring. Like any service, it will depend on what you get for your money. I will point you to the Federal Trade Commission Consumer Protection website to review the August 26, 2024, article: Home title lock insurance? Not a lock at all | Consumer Advice. From what I read there, the main point of the alert is to remind consumers that you aren’t getting insurance that will reimburse you, but a monitoring system that proports to alert you after the fact about a deed filing. I am unaware of any of these services being able to prevent a transfer before it happens. If you are considering a service, ask the following questions:
   1. How do you monitor?
   2. How frequently do you monitor?
   3. What are you monitoring for?
   4. How and when will you let me know about an issue?
   5. What will you do to help me if a fraudulent deed is recorded?

Identity theft is on the rise everywhere, including in the area of real estate ownership. You need to be alert. I don’t have an opinion as whether you should buy a third-party monitoring service because I don’t use one myself, but I do know there are some effective ways to monitor your deed on your own and I hope this helps you to better understand your options.

Fun Fact: The Rüppell’s Griffon Vulture is the highest-flying bird, known to have reached an altitude of 37,000 feet (over seven miles!). How do we know this you might ask? Because one collided with an aircraft at that altitude in 1973 and damaged the engine. After the plane landed they identified the remains as the Griffon Vulture.