Purchasing a home is an eventful decision and one of the biggest transactions a person may make. Once obtaining the dream of home ownership, some homeowners have been unaware that they had their dream threatened and snatched away by deed theft. Over the past few years, deed theft has become prevalent in our neighborhoods and in new stories across America. In New York City alone, Brooklyn has been experiencing an unprecedented amount of deed theft compared to the other four boroughs. Approximately 1,500 residents of Brooklyn are fighting deed theft. Deed theft can also be the cause of a foreclosure on a property. Areas in Brooklyn that have historically had heavy amounts of lis pendens (a lawsuit pending) and foreclosures, such as central Brooklyn, are also areas where predatory lending and deed fraud are common, and that were formerly redlined.
The total number of first-time residential foreclosures spiked 87% year-over-year, from 867 in 2022 to 1,620 in 2023. Queens is the top borough with foreclosures, with 631 properties, representing roughly 39% of all citywide cases. Last year, Brooklyn had 541 foreclosures, representing 33% of all New York City foreclosures in 2023. An alarming figure for Brooklyn is that the borough underwent a 201% year-over-year surge of foreclosures — the sharpest increase among the five boroughs.
This article aims to explain deed theft, how to protect yourself and your home, and how to prevent a decade or longer fight to reclaim ownership of your property. Most of the information in this article is universal, however some details pertain to Real Property Law of New York State.
Let’s start with a few definitions:
A title is a legal concept that refers to ownership rights - it’s evidence of the right to possess property
A deed is a written, physical document that transfers an interest in real property from one party to another; the Statue of Frauds requires that every deed must be in writing; the law does not recognize an oral transfer of real property
The grantor is the party who is conveying title; this person must be legally competent, reached the age of majority which is 18 years old in New York, and mentally competent; the grantor in a deed may be referred to as party of the first part
The grantee is the person who is receiving the title and does not need to have legal capacity; the grantee may be referred to as party of the second part
A deed includes details such as the names of the parties involved, property’s legal description, sometimes specific conditions or restrictions on the property, and consideration. Consideration - something of value, i.e. money, has to be present. In New York, the deed does not have to indicate that amount of consideration involved. It can state, “One dollar (or ten dollars) and other good or valuable consideration.” A deed must be signed by the grantor; a grantee must sign if they are receiving financing for the purchase of the property, i.e. mortgage loan. Once the deed is signed and notarized, it is usually recorded with the local government, such as the county clerk’s office. Recording the deed is an important step because it publicly establishes your ownership, providing a safeguard against disputes or claims by others. Deeds come in various forms—such as full covenant and warranty deed, general warranty deed, bargain and sale deed, quitclaim deed, and special warranty deeds—each offering different levels of protection for the buyer.
Deed theft, also known as title theft, is the unlawful transfer of property. Deed theft occurs when a thief takes the title to a home without the homeowner’s knowledge or approval. Criminals record fraudulent deeds, mortgages or other liens against a property without the owner’s knowledge or consent. The thief can then use the fraudulent deed to sell the property, take out loans against it, or even evict a homeowner from their own property.
Deed theft typically occurs through forgery, fraud, identity theft, and fraudulent liens and foreclosures. Some examples are below:
Forgery - A thief fakes a homeowner’s signature on a deed and files it with the county clerk
Fraud - A homeowner signs their deed over to a thief without realizing what they are signing; oftentimes the thief makes false promises to help the homeowner
Identity Theft - A criminal steals your personal information to impersonate you; they may then forge your signature on a deed transfer document, notarize it, and file it with the county to make it appear legitimate
Fraudulent Liens and Foreclosures - Criminals will create fake liens or initiate fraudulent foreclosure actions to take control of a property; after securing the deed through these schemes, they may sell the property to unsuspecting buyers or take out loans
Any homeowner can be a victim of deed theft, but criminals primarily target:
Abandoned or empty properties
Properties in foreclosure
Properties with tax or utility liens
Properties where the homeowner is deceased
Heirs who do not legally transfer title to the property
Anyone can be a victim of deed fraud, but seniors, immigrants, and people of color are most at risk.
Types of deed theft scams include:
Short sale scam
Loan modification scam
Refinancing scam
Reconveyance agreement
Foreclosure bail out loan
Rent-to-buy
Fake foreclosure representation for a lawsuit
If you discover you’ve become a victim of deed theft, there are steps you can take to reclaim your property. However, it is crucial to act quickly, as delays may complicate the recovery process and you can end up fighting for your property for years. Some steps are below:
1. File a Police Report
Filing a police report provides official documentation of the crime, which is essential for initiating any legal action and for demonstrating to authorities that the transaction was fraudulent.
2. Contact the County Clerk’s Office
Notify the county clerk’s office where the fraudulent deed was recorded. They can place a flag or alert on the property record to help prevent any further transactions while you resolve the issue.
3. Consult a Real Estate Attorney
A qualified real estate attorney can help guide you through the legal process, file the necessary paperwork, and represent you in court. The attorney may file a quiet title action, which is a legal proceeding used to determine the true owner of a property.
4. Gather Evidence of Ownership
Collect any documents that prove your ownership, such as the original deed, mortgage documents, property tax records, and utility bills. These records can serve as evidence to help validate your claim in court.
5. Notify Lenders and Insurance Companies
Inform any mortgage lenders or title insurance companies about the fraudulent deed. If loans were taken out by the thief, you may be able to work with lenders to nullify these loans, especially if you have title insurance that covers fraud.
6. File for a Court Order to Nullify the Fraudulent Deed
In many cases, your attorney will need to request a court order to officially cancel the fraudulent deed. Once the court grants this order, it can be filed with the county to formally restore your name as the owner.
7. Monitor Property Records Going Forward
Even after recovering ownership, it’s wise to continue monitoring property records to catch any future fraudulent activity. Many government offices offer property alert services, which can be useful for ongoing protection.
To be proactive in protecting your property from deed theft, make sure to:
Never transfer your deed or ownership of your property without a real estate attorney’s advice
Have a will; deed thieves often target homes where the owner died many years ago and their heirs did not transfer the title
Do not abandon your property; take care of it yourself, or ask someone else, a family member, friend, or property management company to look after it
Read everything and never sign anything you do not understand; contact a real estate attorney first for advice
Keep up with your property payments, including your mortgage, property tax, and utility payments
Contact your local county clerk to check on your property records
Organizations you can contact for assistance with foreclosure prevention, deed theft, and monitoring your property include:
1. HOPP - New York Homeowner Protection Program:
2. New York City Department of Finance, Office of the City Register:
Notice of Recorded Document Program - The City Register will automatically mail you a notification when a new document is recorded against your property. You can also designate someone you trust, such as a family member or legal representative, to receive notifications. (Please note that owners of cooperative apartments and timeshare units may not want to register for notification as these properties do not have unique borough, block and lot identifiers and the registrant would receive notifications affecting the entire building rather than for the particular unit of interest.)
3. Legal Services NYC:
4. The Legal Aid Society:
Deed theft is a serious crime that can compromise your property ownership, leaving you at risk of financial and emotional hardship. However, by understanding what a deed is, taking preventative measures, and acting quickly in the event of fraud, you can protect your property rights as a homeowner. Purchasing your home was your dream - it’s an investment, it’s generational wealth. Safeguarding your home and staying vigilant can make all the difference in preserving your dream.
LaShawn Freeman, Douglas Elliman Real Estate Agent
Unlocking new memories, one door at a time.
M: 917.254.3313 / E: lashawn.freeman@elliman.com
Comentarios