Identity Theft

Another Reason for Title Insurance...
Identity Fraud

We read all about it. It's in the newspapers, on the news, and on the internet. High profile people becoming victims of identity fraud. You think it could never happen to you. Right?

Think again. Identity fraud can happen to anyone."Identity fraud" is one of the fastest growing types of financial crimes in America with almost a 1,000,000 victims each year! These crimes are mostly against average working people. I even know a lawyer who it happened to and even he struggled to clear it all up. Experts estimate the cost of this type of crime is over $100 billion annually.

PROTECT YOURSELF FROM IDENTITY THEFT! Identity Theft occurs when someone wrongfully uses your personal identification to obtain credit,loans, services, even rentals and mortgages in your name. They may even commit crimes while impersonating you!

TIPS FOR BEATING IDENTITY THEFT:

Be careful of "Dumpster Diving" Make sure that you do not throw anything away that someone could use to become you. Anything with your identifiers must be shredded before throwing away..

Be careful at ATM's and debit card machines. Onlookers can get your "Pin Number" and get access to your accounts.

If you are still using paper checks get new orders of them delivered to your bank not to your home address.

Do not put checks in the mail from your home mailbox.Drop them off at a U.S. Mailbox or the U.S.Post Office. Mail theft is more and more common. With color printers and laser printers it is easy for people to forge new checks or even change existing ones.

Cancel all credit cards that you do not use or have not used in 6 months. Personally I ask my bank for a new debit card with a new number each year. You'd be surprised at the things you set up on auto pay and forgot about. Plus, who knows who else might have the number.

Put passwords on all your accounts and do not use your mother's maiden name. Make up a fictitious word.

To avoid problems with mail theft get a post office box or a locked mailbox,if you possible.

Do not carry any identifiers you do not need. Don't carry your birth certificate,social security card,or passport,unless necessary. If you have cards credit/membership/ID cards you won't be needing for a period of time leave them in a safe place at home.

Memorize social security numbers and passwords. Decline to give your
social security number for routine office visits to doctors, dentist vets - they always seem to ask but they do not really need it.

Do not put your credit card account number on the Internet unless it is encrypted on a secured site. Just because a company has an internet site does not mean you can trust them with your credit card information. Use trusted providers.

Monitor all your bank and credit card statements from every source every month. Check to see if there is anything that you do not recognize and call about it right away. Don't put it off. Often times there are time limits on reporting suspected fraud.

Try to review your credit report at least twice a year. If you see anything that appears fraudulent, immediately put a fraud alert on your reports.

REAL ESTATE: Your title insurance policy will protect you against hidden risks that may not be discovered prior to the issuance of your title insurance policy. Probably the best feature of title insurance is that it pays any covered loss sustained from such a defect in your title. The one time premium you pay covers you and your heirs for as long as you or your heirs own the property.

So What is A Preliminary Title Report All About?

When buying real estate you will be present with many documents that look unfamiliar to you. Your agent should be able to explain each one to you and why it matter. Here is an outline of what the Preliminary Title Report Contains and the things you should look for in this document.

Vesting– Make sure the names on the Preliminary Title Report are the correct names and that the property is the same as the property on the purchase contract.

Taxes and Assessments-  In addition to looking for special tax districts you might not have been told about you can look for an exemption or classification designation that would change the tax amount as a result of the sale. It is common, in California, for properties to be reassessed upon sale.

Deed of Trust –  To make sure all debts on the property are being paid off in your transaction be sure all paid off Deeds of Trusts are reconveyed. Upon proof of payment and/or an indemnity, the title company may insure around the encumbrance.

Identity Matters – As a buyer you will provide a  ‘Statement of Information’ which can clear up identity issues that may arise. The seller will have to do one as well. If there are judgments and liens that belong to the party in question and have been paid then a release or satisfaction must be obtained and recorded or filed to eliminate the matter.

Pending Actions – A civil action affecting real property generally will have to be dismissed before title can insure. A divorce or probate doesn’t have to be finalized but special requirements may exist. Check with your Title Rep. or Title Officer for more information.

Joint Use Matters – Driveways, common walls and most easements may prompt Lenders to require a joint maintenance agreement. The preliminary title report will show such agreements if one is on record.

Extended Coverage Matters – If a physical inspection of the subject property disclosesencroachments, lien rights, or other matters, these must be addressed before the lender will close. An extended coverage owner’s policy may be requested and a survey of the property will be required. Although this type of situation would delay your closing it is imperative that you get it done before you let the proeprty transfer.

Legal Description - The legal description should always be compared to the legal descriptionin the purchase and sale agreement to be sure that all the property being conveyed has been included in the preliminary title report. I see this most commonly when there has been additional acreage added to the property or multiple buildings exist. In anycase be sure that all property is included in the legal description.

While basic the above gives you a great start on understanding why this document is important and what you need to do with the information contained in it.

 

Title Binder Policy Can Save You Money

In the Palm Springs market place a typical expense of a seller is to pay for the title insurance policy for the buyer when they sell their home. However, if the seller had purchased a Title Binder policy before closing escrow their escrow (back when they purchased the home) the seller can now realize a substantial savings upon resale.

How does this work?

When you are the buyer getting ready to close escrow (finalize the sale) on your new home be sure to request that you be issued a Title Binder policy.The seller you are buying your home from is actually paying the cost of your Title Policy. However, you would request and pay for the Title Binder policy

(typically a few hundred dollars or less - 15% of the cost of the title policy) yourself.

Then three years or less down the road when you go to resell your home you tell your agent that you have a binder policy for the title company. This gives you to a substantial discount on the policy you are going to have to provide for your buyer. Your only fee will be on the difference between what you paid and what your buyer is now paying. Again typically a few hundred dollars versus the thousand plus that you would otherwise be paying.

The three year restriction may not work for you if you are planning on buying and holding the property. Some title companies will allow you to extend it to four years for a small extra premium. Despite this is if you are buying for the short term, know you will be transferred, up-size or downsize or even if you are flipping houses for profit
Title Binder Policies make lots of sense.

Small savings like these may not be dramatic but can really add up overtime and maximize the value of your home ownership experience.