Would you know how to spot deed fraud red flags? Keller Williams Arizona Realty recently hosted Jesi L. Wolnik, Esq. at the Market Center. Jesi presented her class “Dirty Deeds are Not Dirt Cheap” for agents to receive 3 hours of Continuing Education credit for Legal Issues. Jesi teaches at Realty SME Real Estate School, 1166 E Warner Rd, Suite 101, Gilbert AZ 85296. During her class, Jesi showed agents how to spot issues that might be indicative of deed fraud.
What are Deed Fraud Red Flags?
When it comes to deed fraud, anything out of the ordinary could indicate a red flag. Real Estate Agents who work with clients should expect sellers to have knowledge of the property, right? What if the seller does not know much about it? Certainly that is a red flag. There are many spots during a transaction that can give away the possibility of something being “not quite right.” If that is the case, acting sooner rather than later can help prevent malfeasance from continuing.
Red Flags About Sellers
1. You are working with the Seller of the property. But they do not seem to know much about the property at all. If someone is selling a property, they should have some level of basic knowledge about it. Not knowing much about the property may indicate they are not the actual owners.
2. The Seller provides information about who they are and where they live to Agents. What if they say they live in Seattle, Washington, but their driver’s license shows some other location? What if they send you a copy of their passport and it has them as a citizen of a different country from what they told you? Discrepancies in these kinds of documents should be taken as a serious sign that something might be amiss.
3. What if the name on the Seller’s passport is Alexander S. Barton, but they keep referring to themselves as “Barton”? Seems strange, right? Perhaps the person you are speaking with is not the person whose documentation you have on hand.
4. The Seller does not want to meet in person. This does happen, perhaps they are out of state owners. So it might not be a red flag. However, you should be cautious in these instances. Extra care is necessary to ensure they are who they say they are.
Timing Red Flags
1. Everything is urgent. They urgently need to sell the property. They urgently need to sign the paperwork. There is an upcoming issue forcing them to act quickly. True, some Sellers do have urgent situations. However, this could indicate they are working fast to keep you and others from detecting their fraud. Urgency should indicate to Real Estate Agents that great care should be taken to ensure everything is done properly and correctly. Be sure to dot every I and cross every T!
Deed Fraud Red Flags with Notary Publics
1. Take a close look at the notary stamp on a document. Is is blurry? A blurry notary stamp may indicate it has been copied onto the document, and is not an actual stamp.
2. So this Notary on the documents–are they part of the transaction? This is a HUGE red flag. Notaries should not notarize their own documents, and should not be part of the transaction. If you see something like this, it is most definitely something that should clue you in to a serious issue. Notaries must adhere to standards of care and practice in order to keep their Notary Public certification. In no cases should a Notary notarize their own documents!
3. Data about the property, the Seller, and on any notarized documents should match. Do you see any discrepancies? If yes, this is a huge red flag. Don’t assume there is just some minor error that a Title company can find and clean up for the transaction. Be sure to review all the information so it is correct for the transaction.
4. Did the Seller receive a copy of any paperwork they signed for the transaction? If not, this should raise concerns. Paperwork might be altered after the fact, or their signature might be used on other documents. Ensure the Seller does receive copies of all paperwork for the transaction.
5. Your Seller is working with some other company that claims they will pay their note in full. However, the Seller is not shown any paperwork that their note is indeed paid in full. They might be working with a company that takes their money to make mortgage payments, but instead pockets it and lets the home go to foreclosure. This is called “Equity Skimming” and is indicative of deed fraud red flags!
Maricopa County Recorder Service May Help Avoid Deed Fraud Red Flags
The Maricopa County Recorder in Arizona joins many other Arizona counties in offering a great service. Maricopa Title Alert helps property owners safeguard their interest at no cost. This free public service lets property owners register with the office to receive document registration notifications. This is an extremely valuable and important service for property owners. There is no method to stop an attempt at deed fraud; but once something is recorded, action can quickly and easily be taken. This services alerts property owners to possible deed fraud red flags that might be happening with their property. Real Estate Agents should share this valuable and free service with their clients.
Keller Williams Arizona Realty offers an extensive amount of classes, training, and education. Many classes such as Jesi’s are open to all Real Estate Agents. View our upcoming events to learn more about us. If you do want to attend classes or events, we are confident you will see the outstanding value we offer to our Real Estate Agents.
Call us today: 480-767-3000