Quitclaim Deed Fraud on the Rise, FBI Says

NEW YORK — Unsuspecting homeowners are discovering their properties have been sold out from under them in a scam that authorities say is becoming more common: Quitclaim deed fraud.

The scheme, also known as home title theft, typically involves fraudsters forging documents to record a fake transfer of property ownership, creating a nightmare for the rightful homeowner.

A couple in Dayton, Ohio, was indicted earlier this week after being accused of forging documents to steal an elderly man's home, which they later allegedly put up for sale for $119,000. The 67-year-old homeowner had never met them.

The case is just one example involving quitclaim deed fraud, which the FBI says is on the rise.

Your home can be stolen without a knock: What you can do to prevent it

"Folks across the region are having their roots literally pulled out from under them and are being left with no place to call home," Jodi Cohen, special agent in charge of the FBI Boston Division, said in an April warning.

While there is no national data on quitclaim deed fraud specifically, the FBI said that from 2019 to 2023, 58,141 victims reported $1.3 billion in losses related to real estate fraud.

Here's what to know and how to protect yourself

What is a quitclaim deed?

A deed is a legal document used to transfer ownership of a property from one party to another, but not all deeds are the same. Different types offer varying levels of protection.

General warranty deeds are the most common and guarantee that the property has no outstanding title issues, according to Rocket Mortgage. They also ensure that the current owner has the legal right to sell to the buyer.

There are also quitclaim deeds, which are more streamlined but offer no warranties or guarantees about the property's title. In fact, a quitclaim deed doesn't even prove the grantor had a valid claim to the property.

Rocket Mortgage describes a quitclaim like this: "It simply says, 'Whatever I had is now yours.' If 'whatever' turns out to be nothing, so be it." They're commonly used in divorce cases when one spouse transfers the ownership of a property to the other as part of a settlement.

Quitclaim deeds are generally quicker and less expensive than other types of deeds, making them convenient but also vulnerable to scammers.

What is quitclaim deed fraud?

Deed fraud, also called home title theft, is when a thief transfers the title of a home or land without the homeowner's knowledge or approval, often by exploiting quitclaim deeds. If successful, criminals can sell the property, take out a mortgage on it, or even rent it out to make a profit, leaving the real owners to fight in court to reclaim their property, the FBI said.

There are two common ways deed theft occurs: forgery and fraud.

With forgery, a thief fakes a homeowner's signature on a deed and files it with the county clerk. Whereas fraud is when a homeowner is tricked into signing their deed over without realizing what they are doing.

The FBI attributes the rise in quitclaim deed fraud partly to changes brought about by the COVID-19 pandemic.

"More and more people have grown accustomed to conducting real estate transactions through email and over the phone. The remote nature of these sales is a benefit to bad actors," the FBI Boston Division wrote.

Who is at risk of deed fraud?

Any homeowner can be a victim of deed theft, but certain factors can increase someone's risk. According to the New York Attorney General's office, criminals primarily target:

• Abandoned or empty properties
• Properties in foreclosure
• Properties with tax or utility liens
• Properties where the homeowner is deceased and the heirs do not legally transfer title to the property

AARP has also warned that older people are often at greater risk because they're more likely to own their homes outright.

In one particularly egregious case last year, a 60-year-old nonprofit director in Detroit was accused of orchestrating a fraud scheme that stole houses from dozens of residents.

Federal prosecutors said Zina Thomas and others filed multiple fraudulent quitclaim deeds to steal more than 30 properties across Wayne County, Michigan, ultimately selling them to unwitting third parties.

Thomas specifically targeted low-income individuals who were facing potential tax foreclosure, authorities said.

How to prevent deed fraud

Deed fraud and identity theft often go hand-in-hand, so it's important to guard your Social Security number, identification and financial account information.

It's also worth checking to see if your county has a free property fraud alert system. Many county recorder's offices offer the service, which protects homeowners by notifying them whenever a document is recorded under their name in the public land records.

If your county clerk's office doesn't offer title alerts, it's important to stay vigilant and proactively monitor property records online.

Keep an eye out for any mail addressed to someone else at your home, which could indicate that someone has illegally transferred your deed to their name, AARP said.

You should also be suspicious if you suddenly stop receiving your water bill or property tax bill, the FBI said.

And never sign a real estate document under pressure, especially if you don't understand it. Consult with a reputable lawyer to be clear about what you are signing.

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