Today’s newsletter will focus on title theft, the label now used for an attempt to fraudulently transfer ownership of real estate. This came before the Lowell City Council at Tuesday night’s meeting in the response to a motion on this topic.

(The Council addressed other topics deserving of attention, but I’ll cover them in next week’s newsletter.)

Title theft occurs when someone forges a deed that purports to transfer ownership of a home from its current owner to someone else. The owner knows nothing about this and is shocked to discover that the records of the registry of deeds suddenly show that someone else owns the home.

Under Massachusetts law, a forged deed does not convey title, so even if a forged deed is recorded, the true owner would not be dispossessed of the property. However, the true owner would face the cost and hassle of going to court to clear the record.

More on this below but first some context: In my 30 years as register of deeds from 1995 until 2024, more than two million documents were recorded at the Middlesex North Registry of Deeds. Through all that time and all those documents, only one instance of attempted title theft was discovered. It is very rare but I suspect its frequency is increasing so it should not be disregarded.

Here’s what happened in the one case I encountered: An elderly couple owned and lived in their long-time home in a nearby town. They were both disabled and rarely left the house which suffered from a lack of upkeep. There was no outstanding mortgage on the property and property taxes were paid on time. Two adult children of the couple lived in Massachusetts although not nearby. One elderly spouse died. Soon after, the surviving spouse also passed away. This left the house vacant. Although the children of the couple immediately inherited the property through the laws of probate, they put off filing anything in probate court that would formalize this change of ownership and left the property vacant and untouched.

In the meantime, a person with no connection to these people or their property drafted a deed that purported to convey the property from the now deceased elderly couple to that third person. This deed drafter (I’ll call them “wrong doer” from now on) forged the signatures of the elderly spouses, forged the signature of a notary public, and back dated the document to a time when both elderly spouses were still alive. Wrong doer brought that deed to the registry of deeds, paid the recording fee in cash, and left it to be recorded which it was.

With the registry record now showing wrong doer as owner of the property, wrong doer called a local real estate broker and tried to list the property for sale. Fortunately, the broker was familiar with the property and its recent ownership situation, so they declined to take the listing. They also tried (unsuccessfully) to contact the adult child of the diseased elderly couple, so the broker contacted the local police department. The PD got in touch with the adult child who immediately hired a lawyer. The lawyer filed the appropriate action in court and quickly got a judicial order that set aside the forged deed. That order was recorded at the registry of deeds. (The case may also be the subject of a criminal investigation, but I don’t know that for certain.)

Now after reading that, you’re probably asking, how could something like this happen? To answer that question, you must first understand a few things about how our system of real estate ownership works.

Most people (incorrectly) believe that selling a house is like selling a car. When you sell your vehicle, you must produce the original certificate of title for the car and sign it over to the new owner. When it comes to your house, people logically believe that the deed for the house is the equivalent of the title to the car but that’s not the case.

Your deed is not a unique physical artifact that must be closely guarded. Instead, it is a memo that expresses the property owner’s intent to transfer ownership of the real estate to someone else. Each time the property is transferred, a new deed must be created and recorded. The primary protection against fraud comes from the requirement that no deed may be recorded at the registry of deeds unless the signature of the owner has been acknowledged by a notary public. That works as intended most of the time although as the real-world example I describe above illustrates, if someone is willing to forge the owner’s signature, they are equally willing to forge the notary public’s signature.

Conceivably, the law could require the owner of real estate to physically appear at the registry of deeds and present some form of government identification to authenticate their signature on the deed, but that would be an example of the cure being worse than the disease. Currently, less than ten percent of recorded documents are brought to the registry of deeds by a human being. The majority – about 85 percent of the total – are recorded electronically and another 10 percent arrive by some form of physical mail. To require everyone selling real estate to physically appear at the registry would cause the system to grind to a halt with major implications for the trillion dollar real estate industry. To upend the system to guard against forged deeds that happen only rarely and, in the end, do not deprive the true owner of their property, would make little sense.

Does that mean homeowners are powerless against title fraud attempts? Not completely. Secretary of the Commonwealth Bill Galvin offers a free “Consumer Notification Service” (CNS) which is an automated real estate record monitoring service. If you sign up and enter your name and the property address of your home or other property, anytime a new document is recorded at the registry of deeds that includes that name and address, the system will automatically send you an email that notifies you of the new document.

To be clear, this system just does not prevent a forged document from being recorded; it just gives you an early warning of it. The burden is then on you to do something about it. You can and should call the police, but the most important thing to do is quickly hire a lawyer to immediately start a lawsuit with the goal of having the forged deed judged to be void.

Very early in that lawsuit, your lawyer should have the court issue something called a lis pendens (which means “notice of lawsuit that affects real estate”) and record that at the registry of deeds. This puts the entire world on notice that there’s something amiss with this property and should keep things from getting more complicated. For example, the wrong doer might convey the property to an innocent third party, or borrow money secured by a mortgage on the property. In either case, the true owner would prevail over the innocent purchaser or lender, but the more victims become involved in the scam, the more complicated things become, which is why getting a notice on record at the registry is so important.

(And you can’t just walk into the registry and say, “my property has been stolen.” That’s something that happens frequently and it usually arises from an interfamily dispute that always has another side. That’s why the law prohibits the registry from recording something that would encumber property without it first being authorized by a judge who can ensure due process for all involved.)

Even if the forged deed is eventually undone by this lawsuit, as it almost certainly would be unless there was some collusion between the homeowner and the wrong doer, the innocent homeowner still bears the substantial financial burden of hiring a lawyer.

If you obtained a mortgage when you bought your home, or if you have refinanced, your lender likely required you to obtain title insurance. You pay a one-time premium for title insurance which is handled by the lawyer and bundled into the closing costs, so most people don’t know whether they have it. Title insurance protects against problems with the property’s title and covers issues like unpaid taxes and liens. Some title insurance policies also cover fraud, so if your policy included that, your title insurance company would pay your legal costs in unwinding the forged deed in court.

Not all title insurance policies cover this type of fraud and even if they did, not everyone has title insurance. The homeowners least likely to have title insurance – those who are elderly and have owned their property for a long time – are also the ones most likely to be the victim of this type of fraud.

I think a better approach would be for the state legislature to require home liability insurance policies, which almost every homeowner has, to cover the cost of defending against deed fraud. In the extremely rare instance of attempted title theft, this would protect the innocent victim from bearing steep legal fees while maintaining a document recording system that works quite well 99.9 percent of the time.

Finally, I want to clarify my assertion that in my 30 years as register of deeds, I only saw this one instance of title theft. That remains true for cases where a stranger committed the crime, but there were also a handful of cases in which family members of caregivers engaged in fraud.

In one case, an elderly parent owned a home outright. One adult child lived with the parent. Two other adult children lived elsewhere. The parent’s intent was that upon their death, the three children would inherit the property equally. However, the day after the parent died, the adult child who lived with the parent forged a deed that purported to transfer ownership of the property from parent to that child. Rather than forge the signature of a notary public, the adult child convinced a friend who was a notary to notarize the document without having seen the father sign it. That is perhaps the worst thing a notary can do – you must see the person sign in your presence – but that’s what happened. The adult son recorded the deed and, on the record at the registry of deeds, appeared to be the outright owner of the property.

His siblings weren’t having it, however, and very aggressively sought redress through the court system and the criminal justice system. Although brother/forger and notary both stuck to their stories that no fraud was involved, a judge in a civil trial found they had forged the deed and issued an order voiding it which placed ownership equally in the three siblings. Also, the Attorney General’s office vigorously prosecuted this case which resulted in the wrong-doing sibling being sentenced to jail.

In another case, the victim was an elderly homeowner who was in a nursing home with diminished physical and mental capacities. A neighbor who had long assisted the elderly owner with routine maintenance tasks and who coveted the elder’s property, showed up at the nursing home with a notary public and a deed that purported to convey the property from the elder to the neighbor and prevailed upon the elder to sign the deed which the elder did. (Although the notary in this case did witness the person sign it, whether the signature was the person’s “free act” was questionable.) A relative of the elder learned of this transfer, called the police, and hired a lawyer. The transfer was ultimately undone and the relative ended up with the property upon the death of the elder.

What I hope these two cases illustrate is that the risk of fraud (or undue influence that does not rise to the level of criminal fraud) is more likely to involve a family member or someone with a close relationship to the victim than it is a stranger. In either case, the most likely victim is an elder who has owned the home for many years. If you know of such a person, it’s probably prudent to check the status of that person’s property on the registry of deeds website from time-to-time, to get early warning of any improper activity.

****

This week on richardhowe.com:

I wrote about last Sunday’s program at St. Anne’s Church about the Underground Railroad in Lowell.

Steve O’Connor reminisced about Malcolm Sharps, a unique individual Steve had befriended in 1979 and who later became a regular contributor to this website until his timely death last year.

Paul Marion posted a 1975 essay by Julie Mofford about Robert Frost and his beginnings in Lawrence, Massachusetts.

Louise Peloquin reminded us that the “buy local” trend is not new by sharing 100 year old stories from Lowell’s L’Etoile newspaper which urged readers to shop in local stores.