Title insurance fraud can affect consumers in many ways. Title insurance basically provides protection for buyers in a home sales transaction. The insurance policy will usually provide limited coverage for issues such as a transfer of a defective title, or a breach of contract terms by the seller. However, in light of recent housing and economic conditions, prospective homebuyers have become targets for title insurance fraud.
Like any form of fraud, title insurance fraud can sometimes be difficult to detect. This is especially the case for young or inexperienced buyers who have no basis for comparison when it comes to title insurance policies and payouts. Thus, it’s helpful to understand how title insurance fraud works and what can be done to help prevent it from occurring.
Some common title insurance fraud methods include:
In addition, forgery is often an issue when it comes to title insurance. Again, certain conditions can make this more of a risk, for instance, when any of the parties are not physically present during the sales process.
Title insurance fraud can result in various legal remedies, depending on the individual facts for each case. In most instances, a monetary damages award will be required from the defendant. This is paid to the plaintiff in order to compensate them for losses that were directly caused by the fraud.
In many instances, title insurance fraud lawsuits are filed as class action lawsuits. This can happen for instance, if a broad insurance policy negatively affects a whole class of consumers. These types of lawsuits can often result in higher damages awards.
Lastly, criminal charges can sometimes result, especially in instances where an insurance broker is practicing illegally or is engaging in various white collar crimes in order to complete an insurance fraud scheme.
Every year, title insurance fraud affects large numbers of consumers, causing financial waste and affecting sales transactions. You may wish to hire a qualified lawyer if you suspect that you have been affected by fraudulent title insurance methods. Your attorney can help explain your legal rights to you, and can represent you in court if you need to file a lawsuit for damages.
Last Modified: 03-17-2015 11:27 AM PDTLaw Library Disclaimer
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