Geoff Henley is a Dallas-based lawyer, real-estate investor and former title-company owner. When I describe to him the business model of Home Title Lock—charging terrified oldsters $19.95 a month to provide them with “complete protection” against the subatomically miniscule possibility of losing their homes to simple title fraud—he laughs for almost a minute straight.
“Damn,” he says after regaining his composure. “I wonder if it’s too late for us to start one of those?”
If you listen to talk radio or watch cable news, you know about Home Title Lock. It’s not the only company of its kind, but it’s the best-known. Political TV and radio are absolute cavalcades of baloney, avalanches of quacktastical ads for miracle doggie vitamins and dehydrated vegetables in capsule form, fish oil supplements infused with botanicals, and sundry pills and powders and potions and gold coins and real-estate seminars to make you independently wealthy. The message is always a variation on the themes of pain and fear. Get your life back. Take control. Protect yourself. David Foster Wallace described the goal of advertising as to “create an anxiety relievable by purchase.” It’s a strategy cable news and talk radio take seriously, even when they have to invent or exaggerate a source of anxiety.
The story the home-title monitoring companies tell in their overwrought advertisements is indeed anxiety-inducing. A shady guy forges your name on a document. Then he files a phony deed saying he owns your house. Soon he sells the house or takes out a big loan against it. This leaves you—the elderly viewer or listener trembling in your Buick at the stentorian tones of Sebastian Gorka—homeless and financially ruined.
Except this doesn’t happen—at least not like that.
If a bank makes a loan based on a forged deed, the bank eats it. If a would-be homebuyer hands a bag of cash to a guy who put your name on a deed and stamped it with a fake notary’s seal he bought off the dark web, the dupe doesn’t get your house. There is no jurisdiction in the United States in which a forged deed has any legal standing.
“The people who run banks and insurance companies aren’t stupid,” Henley says, perhaps with a touch more conviction than the recent historical record should permit. “To lose a house this way would involve such an improbable series of events, I can’t imagine this service being remotely valuable.” His view is echoed by pretty much everybody I talk to about the issue—except for the guys at Home Title Lock.
“Those ads do a great job of creating shock,” says Steve Gottheim, general counsel at the American Land Title Association. (That’s the national trade group for title companies—the people whose business is making sure that the person selling you a house actually owns it.) “We do not hear a lot about deed fraud in a way that should give homeowners a reason to panic.”
In the interest of fairness, note that Gottheim is talking about companies that are, at least at some notional level, competition to the businesses his trade group represents. Some title companies now sell “enhanced” title insurance, a relatively new product designed to protect against future title disputes rather than to resolve existing uncertainties at the time of purchase, as conventional title insurance does, and they argue that this is what the people who pay for title-monitoring services should buy instead.
Being a lawyer, Gottheim chooses his words carefully. Yet over the phone I can practically hear his eyes rolling: He clearly gets asked about this a lot. “All they do is notify you,” Gottheim says of title-monitoring companies. A title-insurance policy, on the other hand, will defray a portion of your legal costs in the event of a title dispute that goes to court. But outside of a few pockets of the country where there are elevated levels of deed fraud—typically older inner-city neighborhoods with a large number of absentee homeowners—there isn’t much reason to worry about home-title fraud. The simple forgery scenarios described in the TV and radio spots don’t line up with reality.
“Be very skeptical,” Gottheim advises. That’s almost always good advice. Yet talk-radio programming and talk-radio advertising, in a unified voice, shout back: “Be afraid.”
Henley explains that conventional title insurance guarantees buyers “good title”—unambiguous, uncontested, and unencumbered ownership—when they buy a property. Houses typically last a long time, have several owners, and get passed on in inheritances. All this makes ownership disputes more common than with cars or other movable property. Title insurance is different from health insurance or life insurance in that it seeks to protect against the possibility that something has happened in the past rather than against the chance that some unfortunate event may come to pass. It’s about ruling out preexisting conditions.
All but the most irresponsible and incompetent bankers and lenders insist on a title search before making a home-equity loan or writing a mortgage. That makes the kind of fraud suggested by the Home Title Lock ads hard to pull off. I wasn’t able to find a single case of a homeowner losing his house or being burdened with a fraudulently obtained loan after challenging a fraudulent deed in court. Asked for documented examples, Home Title Lock demurred.
People can still lose their houses to unsavory characters, but simple “deed theft” isn’t the paramount problem.
In most U.S. counties anybody can file paperwork with the recorder of deeds claiming to be the new owner of a house. These are recordkeeping offices—not investigative agencies—and their job is simply to file the documents with which they are presented. But that doesn’t mean that the rightful owner will simply lose his house or be in any real danger of doing so. If a criminal files such a fake deed and tries to sell the property or take out a home-equity loan, the banks will typically discover this during the routine title search. Title investigators have all sorts of ways to spot a fake deed: a phony or suspicious-looking notary seal or perhaps a simple “quit claim” deed (“I hereby give to X all interest in this house”) rather than a robust legal document. Also suspicious is any document filed by a lone, unknown individual who is not a lawyer, bank, or title company. In the unlikely case that such a loan were made, the homeowner should have relatively little trouble showing that the deed was fake, and the fraud artist is not likely to show up at court to plead his case. Successfully ripping off a mortgage lender typically requires a lot more than forging a signature on a deed.
The legal process can be slow and grinding, and that often is the case in real-estate disputes. The homeowner will pay some price in time, hassle and, inevitably, lawyer’s fees. But that will happen with or without a monitoring service. And Home Title Lock provides automated alerts, not legal services. Paying for subscribers’ legal expenses “wouldn’t make economic sense,” says Home Title Lock adviser Arthur Pfizenmayer, a retired FBI agent. “Not for what we charge.”
Maybe the most illuminating parallel case is in criminal law. Anybody can walk into a police station and accuse you of practically anything. You may be obliged to go to court to defend yourself—at some trouble and potentially great expense—even if you are completely innocent. And people do make false claims to the police, but not that often, because unless your name is Jussie Smollett, they put you in jail for that sort of behavior.
Newt Gingrich, pitching Home Title Lock, cites an “FBI warning” that home-title theft is “one of the fastest-growing white-collar cyber crimes in America. Other Home Title Lock ads cite “FBI Internet crime reports.” If that sounds surprising, that is because it isn’t true.
In fact, the FBI press office tells me they never claimed that home-title fraud is the fastest-growing crime (or fastest-growing white-collar crime, or fastest-growing cyber crime, depending on the ad copy). In fact, the FBI doesn’t specifically track such fraud as a category of crime—mostly because nobody calls the FBI to complain about it. When the FBI deals with a home-title issue, it typically involves sophisticated international hacking schemes in which professional criminals (who tend to bank in Thailand and Hong Kong) target title companies to intercept wire transfers of down payments. This is a real problem: from 2016 to 2021, the FBI says, there were more than 116,000 such fraud attempts targeting U.S. institutions, with almost $15 billion in successful or attempted thefts. But that is people running phishing schemes on banks and title companies, not fraudsters using fake deeds to rip off homeowners.
Pfizenmayer, the retired FBI agent and Home Title Lock adviser, huffs and puffs when pressed on hard numbers and says the company is “extrapolating” from the FBI figures based on its own experience. That may very well be true, but the ads don’t exactly say that.
“If I thought this was a scam, I wouldn’t be here,” he says. I’ll note here that it was he who introduced the word “scam” into the conversation.
Pfizenmayer says he has fake notary seals for a half a dozen states and sometimes makes up fake quit-claim deeds just to show people how easy it is. “My notary number is our 800 telephone number,” he says.
In the real world, a successful home-title fraud takes more than a guy with a fake notary seal. The really sticky cases don’t involve forged signatures and fake notarizations. Rather, they involve real signatures on real documents. Some of these are straight-up fraud, often involving fake reverse-mortgage loans or con artists pretending to offer “mortgage relief” services. In these cases, homeowners actually sign the paperwork and get it properly notarized—but do so under false pretenses. In other cases, the line between outright fraud and family disputes gets fuzzy. A typical case might involve a family member or home-health aide who has spent years caring for an elderly person whose would-be heirs are surprised to learn that the house they had expected to inherit has been sold or given to someone else. If the original owner has passed away or becomes disabled, there may not be any obvious way to sort that out. The will may say the kids get the house while the deed says somebody else already owns it.
“Often, it’s not your classic forgery,” Gottheim explains. “People taking advantage of an elderly person who actually signs the deed—those are the hardest ones to clean up and figure out the right, equitable solution. Straight forgeries are much easier.”
New York state has seen elevated levels of deed fraud, more typically mortgage-relief scams than simple deed forgery. It’s been a particular problem in parts of New York City with a lot of elderly and absentee homeowners, often in minority neighborhoods. These often involve houses that have been in the same family for two or three generations but whose current owners have moved to Florida or an elderly care facility. Such properties may already have ownership issues such as liens or unresolved issues. Homes already in default and foreclosure often invite phony “mortgage relief” services. But the homeowners of New York City have no particular need for a deed-monitoring service because the city itself will notify them of deed changes free of charge. That monitoring can be valuable for identifying problems, but it hasn’t actually prevented those problems. And even in New York, such fraud it isn’t a huge problem: The attorney general’s office reports that there have been about 3,000 complaints over the five-year period of 2016 through 2021, almost half of them in Brooklyn.
For perspective, there were more murders in New York City during those years.
New York isn’t the only place that offers free monitoring services, which can do some good. There are cases in hot real-estate markets such as Orlando where county offices have alerted property owners to changes in their deeds and prevented fraudulent sales. And there are some situations in which Home Title Lock or something like it might be of interest: It may feel like a gross invasion of privacy, but you can sign up for title monitoring on any property even if you don’t own it. If you think grandma is getting a little too chummy with that nice young man who helps her take out the garbage, you can, if you are so inclined, put her home title under surveillance. Your neighbors can do it to you, too.
I asked Pfizenmayer if he was entirely comfortable with the ads and their fast-and-loose claims about FBI warnings. “Marketing people are weird ducks, quite frankly,” he responds. He says “quite frankly” a lot over the course of our conversation, but I never get the sense he is being quite frank.
There are shady people out there trying to manipulate old and out-of-it people into making bad financial decisions based on fear. Some of them are real-estate fraud artists. Some of them sponsor our most popular talk-radio shows.
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