Protect yourself from mortgage fraud

One morning like any other, when you aren’t expecting anyone, there comes a knock at the door. It’s a bailiff who hands you a repossession notice from a financial institution for defaulting on your mortgage payments. But you already paid off your mortgage a few years ago. They must have the wrong person, right? Nope–the title on your home has been stolen.

Title theft, a type of mortgage fraud, isn’t common–but it’s been on the rise in recent years. It starts with stealing your identity. Fraudsters create fake documents so they can take over the title on your property and then remortgage your house or sell it and, in any case, make off with the proceeds.

The financial institution that’s been swindled will then exercise the mortgage right it has on your home. That’s why the bailiff comes knocking on your door. Even though you’re the home’s rightful owner, you find yourself with the heavy burden of having to prove to the authorities that you were the victim of fraud, so you can cancel the mortgage taken out on your home in your name, or get your home back after it’s been sold to a third party.

The key: protect your personal information

Upon closer examination, title fraud looks a lot like identity theft. The classic victim of identity theft will have unknowingly signed up for multiple credit cards, telephone accounts and personal loans. In the case of title fraud, scam artists attack your most valuable asset: your home. So protecting your personal information is more important than ever.

4 ways to protect yourself from identity theft

  1. Provide personal information only to businesses you know.
    2. Detect and delete malicious emails asking for personal information or concerning financial transactions.
    3. Shred important documents before discarding them.
    4. Contact a credit bureau (e.g., Equifax) at least once a year to check your credit file for any irregularities.

Is your mortgage paid off? Think about title insurance …

Industry experts agree that title insurance is a good way to protect yourself if you’ve paid off your mortgage. Besides preventing fraud, it will save you a lot of hassle if there are title defects or other problems associated with your property.

To learn more about the housing sector or to get expert advice from the largest mortgage lender in Quebec, go to

Gabriel Savard-Payeur | Advisor, Security, Strategy and Governance, Desjardins Group

Photo: iStockphoto