Buying your dream home? Buy title insurance, too.

Buying Your Dream Home? Protect Your Property with Title Insurance

Purchasing a home is an exciting time for anyone, but that joy can soon fade if problems - such as lost or forged deeds or liens on the property - are revealed. Title insurance can protect buyers.

TOP CONSIDERATIONS

Examples of common title defects:

1. Lost, forged, or incorrectly filed deeds. Deeds are the documents that show who owns the property, and if not filed correctly, can lead to unclear ownership rights. This can include titles filed in the wrong name or titles never filed at all. 
2. Fraud. This can take many forms such as falsified documents making it appear as if a mortgage is paid off.
3. Construction and other liens. Unpaid contractors, homeowner association dues or property taxes can result in liens on the property. 
4. Encroachments. Physical structures, such as a neighbor’s fence, that intrudes on the legal property boundary can create title issues at closing. We always recommend getting a survey before you buy.

Types of title policies: Owner’s and Lender’s are the two primary types of title policies. 

An owner’s policy protects you for the purchase price of your home plus legal costs if a title or ownership issue arises. It is usually issued for the amount you paid for your home and will cover you as long as you own an interest in the property. An owner’s policy is not required but is a good idea to protect your own financial interest in the property. 

A lender’s policy protects the lender, and only the lender, if a title or ownership problem comes up after the property is purchased. Unlike an owner’s policy, the dollar amount that would be paid if there was a problem with the title decreases as you pay off the loan and ends when you pay off your mortgage. A lender’s policy is usually required to get a mortgage loan. 

THINGS YOU SHOULD KNOW

Know who you’re hiring: People often choose a title insurer and/or closing agent based on a referral from their real estate agent, lender, or home builder. Get quotes from multiple companies to ensure you are getting the best price. Check with your state insurance department to make sure the company is licensed to operate in the state. 

Start early: Once you have a signed agreement to purchase real estate, you have all the information you need to start getting title insurance quotes from companies. Start searching early to avoid delaying the closing. The buyer and seller don’t have to select the same title or closing agent so shop around to find the best deal for you. In some locations it is customary for the seller to pay for the lender’s policy, read your real estate contract to find out who is responsible for the title fees. 

Be cautious: Real estate often includes transferring large sums of money between buyers, sellers, banks, and closing agents. As a result, they are also a target for cybercriminals. Call your closing agent and lender right away if someone proposes a change to the payment transfer. Check email addresses closely when transacting business online. Call your closing agent and bank right away if something doesn’t seem right.

After closing, check that the deed was recorded in the county records: You can call your county recorder’s office (in New Jersey it is either the county clerk or register of deeds) or check its website to confirm the deed was recorded properly. Ensure the name and address is correct. If you received a loan to buy the property, check for the mortgage as well which will have the lender’s name and the property address. 

Keep a hard copy of your title policy and closing protection letter in a safe place: Title insurance safeguards your ownership rights for the entire time you own the home or property. You will need the policy documents to submit a claim. Title defects may not be found until you sell a property. 

TOP FOUR THINGS TO REMEMBER

•  A lender’s policy only covers the lender, so to protect your own financial interest, consider purchasing an owner’s policy. 
• Shop around for title insurance, even if you receive a title insurer recommendation from your real estate agent, lender or builder. Only by comparing prices can you ensure you are getting the best deal. 
• Take cybersecurity seriously when communicating transaction details through e-mail and ALWAYS pick up the phone and call the closing agent and lender to verify payment transfer details.
• Keep a copy of your policy in a safe place. You will need this information to file a claim.  

 

(Thanks to our friends at National Association of Insurance Commissioners for this information.)

 

We are the New Jersey title insurance agent that does it all for you. For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us, Vested Land Services LLC. We can help!

For your real estate purchase or mortgage refinance or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow@vested.com

@vestedland

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When it comes to selling your home, know whom you are dealing with

We are the New Jersey title insurance agent that does it all for you. For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us, Vested Land Services LLC. We can help!

Real estate crook gets caught!

Hudson County Man Charged In Multimillion-Dollar Mortgage Fraud Scheme

It always amazes us how far people can sink when they try to make a buck. The Department of Justice has released information about one criminal got caught bilking banks out of mortgage money.

According to the press release:

"A Hudson County, New Jersey, man has been indicted for his role in running a large-scale mortgage fraud scheme that involved properties in Jersey City, Union, and elsewhere in New Jersey and caused losses of millions of dollars, U.S. Attorney Craig Carpenito announced today.

"Anthony Garvin, 49, of Jersey City, was charged in a superseding indictment returned June 25, 2019, with one count of bank fraud conspiracy and five counts of bank fraud. Garvin was originally indicted on one count of bank fraud conspiracy and one count of bank fraud on Jan. 11, 2019."

The scheme was to locate distressed sellers and put together short-sales.  Turns out, though that the buyers didn't really qualify for loans, and, guess what, the fraudsters lied!

You can read the full press release here.

For your real estate purchase or mortgage refinance or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow@vested.com

@vestedland

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Fake mortgage loan applications on the rise

Fake mortgage loan applications on the rise.

For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us. We can help. Located in Fairfield, NJ, we are the title insurance agent that does it all for you.

* * * * *

One of the reasons behind the mortgage debacle of 2008 was the many false mortgage loan applications lenders and mortgage loan purchasers relied on when approving the loan.  Whether it was for a home purchase or a mortgage refinance, fraudsters couldn't resist bumping up a borrower's income or otherwise flat out lying on the loan application.

 

Despite the warnings, it appears that fake loan apps are on the rise as told in this report from nytimes.com.

 

Falsified applications are now the most common type of mortgage fraud, their incidence having risen steadily for the last three years, according to LexisNexis Risk Solutions’ annual mortgage fraud report.

The report .... breaks down the composition of verified mortgage fraud activity in 2013 as reported by lenders, insurers and other subscribers to a LexisNexis database known as MIDEX. The database tracks only fraud involving industry professionals, such as loan officers, real estate agents and appraisers.

“Eighty percent of all mortgage fraud involves a professional,” said Tim Coyle, the company’s senior director of financial services and an author of the report. “It almost has to — it’s a very complex game.”

Credit fraud, such as undisclosed debt on a credit history or misrepresentation on the credit report, had a big jump in incidents since 2012 but appraisal fraud is down to 15%, a 5-year low.

 

Read the full report here. 

 

Good luck to us all.

 

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow AT vested.com

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Wells Fargo settles mortgage-abuse case for $85M

The AP reports,

“Wells Fargo & Co. has agreed to pay $85 million to settle civil charges that it falsified loan documents and pushed borrowers toward subprime mortgages with higher interest rates during the housing boom.

“The fine is the largest ever imposed by the Federal Reserve in a consumer-enforcement case, the central bank said Wednesday.

“Wells Fargo, the nation's largest mortgage lender, neither admitted nor denied wrongdoing as part of the settlement. The bank agreed to compensate borrowers who were steered into higher-priced loans or whose income was exaggerated.”

Wells Fargo was accused of inflating borrowers' incomes on loan applications from 2004 until 2008. Sales reps also pushed borrowers towards subprime loans, even if they were eligible for lower rate mortgages.

“Between 3,700 and roughly 10,000 people could be compensated under the
settlement, the Fed said. The payments will likely range from $1,000 to
$20,000.”

Read the full report.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Title Inc.

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 201-656-4506

E-mail vti@vested.com - http://www.vested.com/

Stephen Flatow Wells Fargo mortgages fraud subprime

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New Jersey makes the news, again

Is something wrong with New Jersey’s air?


It must be the air. What else could explain another breaking story about fraud by a New Jersey resident? This time to the tune of $45 million in a Ponzi scheme.

As reported in the Star Ledger, Montclair resident Antoinette Hodgson “told her alleged victims she was using their money to buy and renovate homes and then sell them for profit, authorities said.”

“But in truth, authorities say, she used money from new investors to repay older investors and spent hundreds of thousands of dollars at casinos in Atlantic City and Las Vegas. She also spent more $700,000 on a Dunkin Donuts franchise in Arizona, authorities said.”

Don't get me wrong, I love New Jersey, been here for more than 30 years and plan on staying another 30 years.

The Star Ledger article can be found here.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Title Inc.

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 201-656-4506

E-mail vti@vested.com - www.vested.com

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A Downside of Short Sales

We’ve previously written about short sales. Their numbers are growing as more homeowners sell in a down market. (As a refresher, a short sale occurs when the sale price is less than the amount of outstanding mortgages and expesenses of sale and the lender agrees to accept less than full payment for its mortgage.)

Short sales are subject to abuses that can amount to fraud. The most usual case is the broker who arranges the short sale and does not disclose that his buyer will resell the house at a higher price immediately after the short sale occurs. Title companies are one the lookout for these types of deals and refuse to insure them.

The Sunday New York Times discusses this problem in a column by Bob Tedeschi. Here’s the column

A Downside of Short Sales
By Bob Tedeschi

STRUGGLING homeowners have found some refuge in short sales, in which lenders allow borrowers to escape foreclosure by selling a home for less than what is owed on the mortgage. Government programs offering incentives to both parties will push the number of short sales to 400,000 this year from 100,000 in 2008, according to CoreLogic, a financial consulting firm.

But the jump in short sales has also given rise to a new form of fraud — which, as a recent study by CoreLogic suggests, could undermine the burgeoning practice.

Fraudulent short sales take many forms, but Frank McKenna, the vice president for fraud strategy at CoreLogic and one of the report’s authors, says one arrangement is more common than others.

An agent for the borrower negotiates with the lender to obtain a low selling price for a property, then sells it to a “straw buyer,” or someone with whom the agent is affiliated. The agents are sometimes real estate agents, or employees of businesses that advertise as “foreclosure rescue” specialists, Mr. McKenna said. As the agent negotiates with the lender — and unbeknownst to the original homeowner or the lender — the agent arranges to resell the property at a higher price. The new buyers may not know that they could have obtained the property for a lower price. Or, even worse, they may be victims of identity theft, unaware that their financial information was being used to buy a home.

In other fraudulent transactions, a borrower might purposefully default on a mortgage he or she could actually afford. The borrower arranges to transfer the property to a friend or relative through a short sale, and the original borrower can remain in the home. The new owner can also transfer ownership back to the original owner through a quitclaim deed, Mr. McKenna said.

He estimated that only about 2 percent of the short sales completed in the last two years were fraudulent, but said fraud was becoming more frequent. “It’s happening a lot more in this market because there are so many more short sales,” he said. “There’s more opportunity to go after the quick buck.”

CoreLogic does not track the actual number of fraudulent short sales. Rather, it estimates the figure by identifying short-sale transactions in which the house was quickly sold or “flipped” to a new buyer, or resold for a vastly higher price. The company obtains and analyzes publicly available sales and financial information on most of the nation’s home purchases.

Florida, California, Texas and Arizona had the greatest number of suspicious short sales, according to the CoreLogic report. New York ranked fifth, with roughly 5.5 percent of all short sales falling into the “suspicious” category. New Jersey ranked eighth, with about 3.3 percent of short sales categorized as suspicious. In Connecticut, the percentage of suspicious short sales was close to zero.Mr. McKenna said the rising number of suspicious short sales could undermine the use of these transactions as a foreclosure alternative. That, he said, would be unfortunate, since borrowers and lenders have only recently reported some momentum in successfully completing short sales.

But John P. Bonora, a vice president of the Fairfield County Bank in Ridgefield, Conn., said he did not expect this to happen. Noting that CoreLogic also sells fraud prevention services to lenders, Mr. Bonora theorized that its report might overstate the threat of fraudulent short sales.

“I’d forward the report to my folks and say you should have some of these things in the back of your mind,” he said. “But I don’t think this report would deter us from doing a short sale.”

Still, Mr. Bonora said, the report makes him more suspicious of real estate agents who market themselves as foreclosure specialists.

“They’re probably speaking with borrowers on a daily basis about foreclosures,” he said. “And people are opportunists.”

The story can be found on-line here.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Title Inc.

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 201-656-9220 - Fax 201-656-4506

E-mail vti@vested.com - www.vested.com

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The long arm of the law grabs 2 mortgage swindlers

New Jersey’s Attorney General Paula T. Dow and Criminal Justice Director Stephen J. Taylor announced yesterday “that a Union County mortgage loan solicitor has been charged with conspiring with others – including a Kearny woman who was charged previously – in a scheme to steal millions of dollars by obtaining mortgage loans using false identities and counterfeit documents.”

Nuno J. Sousa, 34, of Elizabeth, was arrested yesterday.  He joins Genilza R. Nunes who was arrested in March.

“The state investigation determined that Nunes, Sousa and a number of co-conspirators allegedly were involved in a sophisticated, multi-million dollar mortgage loan fraud scheme operating in northern New Jersey, including Morris, Somerset, Hudson, Union, Passaic and Essex Counties. The state has specifically alleged that Nunes and Sousa – with Sousa acting as the mortgage loan solicitor – engaged in fraudulent transactions involving five properties, with a total fraud of $2,152,800. However, it is believed that the scheme is much larger.”

We write about these arrests and hoped-for prosecutions not out of any sense of glee but to demonstrate that the real estate market collapse did not result just from the shenanigans of big Wall Street firms but also from thefts and frauds of the kind allegedly pulled-off by these defendants.  If the alleged scheme is part of a larger one, I can’t wait to see the rest.

You can read the Attorney General’s press release here.

For your next title order or 

if you have questions about what you see here, contact 

Stephen M. Flatow 

Vested Title Inc. 

648 Newark Avenue, P.O. Box 6453,

Jersey City, NJ 07306 

Tel 201-656-9220 - Fax 201-656-4506 

E-mail vti@vested.com - www.vested.com

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