House & Apartment

Illinois county recorders have encountered:

• Fake deeds that transfer ownership without consent,
• Fraudulent mortgages with incorrect loan information, and
• False liens. 

Clouded title means there is a dispute about who owns a property. Clouds can come from fraudulent deeds, unpaid liens, or other claims. Until the cloud is resolved, it can be hard to sell or refinance a property.

To clear title, a property owner may need to file a court case, such as a quiet title action.

Deed fraud happens when a person pretends to be the property owner and sells property they do not own. The fraudster may use fake identification, forged documents, or a false notary stamp. They often insist on a quick, remote sale. Sometimes the fake seller also lies to a real estate agent to get them to represent the property and further the scheme.

The fraud is usually discovered after the deed is recorded and money is wired. The buyer loses money and does not gain ownership. The real owner still owns the property, but the fraudulent deed clouds the title and usually requires a court case to clear.

Learn about safety steps for buyers in How property buyers can protect against fraud.

Fake sellers often target owners who are less likely to notice unusual activity at the property, first-time homebuyers, and people over 55.  

At-risk properties include:

• Vacant land,
• Farmland,
• Rental or investment properties,
• Unoccupied homes, and
• Vacation properties.

Fraudsters often focus on properties where the tax bill mailing address differs from the property address.

Warning signs of deed fraud include:

• The property is listed well below market value,
• The seller’s real estate agent has not met the seller and knows little about the property,
• The seller insists on a quick, remote closing,
• The seller or their agent cannot answer questions beyond public information,
• The seller refuses to meet in person or only communicates by email or text,
• The seller or their agent provides conflicting information,
• The seller pushes for unusual payment methods, or
• Wire instructions involve a foreign bank.

Use publicly listed numbers for real estate agents, lawyers, lenders, and title companies. Do not use numbers given by others without checking them first. Scammers often redirect people to fake numbers or email addresses. Learn more about safety steps for buyers in How property buyers can protect against fraud.

When warning signs suggest fraud, do not confront the suspect. Learn about Dealing with real estate fraud.

A real estate lawyer may file:

• A quiet title action to clear ownership,
• A declaratory judgment action to cancel the fraudulent deed, or
• A slander of title claim if the fraud was malicious and caused damages.

These claims are filed in the county where the property is located.

Yes. Filing a false deed can result in charges of unlawful clouding of title, forgery, and identity theft.

Real estate wire fraud happens when a fraudster tricks someone into sending money to the wrong bank account during a property deal. Fraudsters often impersonate lawyers, agents, or title companies and send fake wire instructions. They also target anyone sending or receiving wire instructions, including buyers, sellers, lenders, and title agents.

Once money is wired, it is often gone by the time the fraud is discovered. Buyers may learn at closing that funds are missing.

Learn about safety steps for buyers in How property buyers can protect against fraud.

Warning signs of wire fraud include:

• A second set of wire instructions,
• Urgent requests to send money quickly,
• Emails where the “From:” and “Reply-to:” addresses do not match,
• Misspelled or slightly altered email addresses,
• Emails sent at unusual times, and
• Emails with attachments or links to outside websites.

Do not click on links or download attachments. Use publicly listed numbers for real estate agents, lawyers, lenders, and title companies. Do not use numbers given by others without checking them first. Scammers often redirect people to fake numbers or email addresses. Learn about safety steps for buyers in How property buyers can protect against fraud.

When warning signs suggest fraud, do not confront the suspect. Learn about Dealing with real estate fraud.

In this scheme, the buyer provides a fake check for earnest money. The check is deposited, then the buyer cancels the deal and asks for a refund.

Banks sometimes release funds before fully verifying. If the seller or escrow agent refunds money before the bank discovers the check is fake, the fraudster keeps the refund and the check bounces.

Fake earnest money check scams often target people selling property themselves (for sale by owner). They can also happen when a property owner is represented by a real estate agent or lawyer. 

Warning signs of a fake earnest money check include:

• The earnest money check is large,
• The buyer is not represented by a real estate agent or attorney,
• The buyer is aggressive, then pushes for quick cancellation,
• The check comes from a foreign bank, or
• The check lacks a watermark or security feature.