Protecting your Title: What is Title Lock?

You may have seen ads on TV or online referring to title lock insurance. What is title lock? First, you need to know that it is not a type of insurance. It is more of an anti-fraud service. But what does it do, and how does it protect homeowners? Read the rest of this post to learn more about title lock and what it does.

What is Title Lock and What Does it Do?

Title Insurance or Title Lock

Title lock is not a form of title insurance. With title insurance, you get protection against title defects or claims against your title. Title lock is a service that monitors public records. It looks for attempts to transfer the title from the owner’s name. The service then alerts the owner so they can take action.

If you elect to have title monitoring, you pay a monthly fee, and the service monitors the records for you. They can’t prevent someone from attempting to transfer the title. All they can do is make you aware of title fraud, and knowing sooner could allow you to act faster and prevent it from going further.

Now that you know a little about title lock and what it does, let’s look at what it protects against.

Title Fraud

Title fraud occurs when someone tries to transfer the title to a property without permission from the owner. In most cases, the fraudster would pretend to be the owner or forge the owner’s signature. They could then attempt to sell the property and keep the proceeds. The criminal could also attempt to use the fraudulent title to take out loans against the property.

A title monitoring service can make you aware of fraudulent transactions. With this knowledge, you can take steps to prevent further fraud. However, a title lock does not lock your title or prevent fraudulent transactions. The property owner may also need to deal with various fraud-related legal issues.

Do Homeowners Need Title Monitoring?

These services don’t do much for homeowners. Title insurance is probably a better investment. This type of title fraud is very rare. Even if you are subject to it, the title lock won’t stop it. It would just make you aware of it sooner so you can take action.

The fraudster also wouldn’t have a legitimate claim to your home. Any sales or loans they took out wouldn’t be your responsibility. Lenders wouldn’t be able to foreclose on the home. Dealing with the situation might be a hassle, but your home would likely be safe. Even in the event of fraud, the title monitoring service wouldn’t provide support.

Do you need help buying or selling a home in Montana? Click here to contact P3 & Associates. We are Montana real estate experts, and we would be happy to help you find your home.

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