(BPT) - Your home is likely the biggest purchase you’ll make in your lifetime, and your most important investment. Current home prices remain strong, and this helps boost the average amount of equity per U.S. homeowner. CoreLogic’s Q4 Homeowner Equity Insights show the majority of homeowners have seen their equity increase by a total of $1 trillion since late 2021. Home equity is the primary driver of household wealth — but also one asset most people forget to provide complete protection for. Are you protecting your most important investment?
You probably already protect important belongings such as your vehicle with auto insurance, and have homeowner’s insurance for your property. However, there’s one crucial area homeowners overlook that could be the difference between calling your home an investment or a source of severe financial loss: your home’s title.
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Most homeowners have good intentions to protect their property, but home title fraud is an area often overlooked. You may be automatically protected against major destructive events like natural disasters and theft via your homeowner’s insurance, but this does not cover home title fraud.
Many homeowners don’t realize the vulnerability that exists with the home title recording system in the U.S. The fact is, anyone can present a fake deed with a fake notary stamp, pay a small fee and, if all the spaces are filled in correctly, the county recorder’s office must accept it. Homeowners can be completely unaware of this until the lender tries to foreclose on the home.
This ease of filing and online access to detailed property records has created a new wave of cyber-crime called home title theft.
Whether your house is worth $200K or $2M, it's imperative to understand all the ways you can protect it. The first step is determining how much equity you have in your home. To calculate your home's equity, subtract your current mortgage balance from your home's market value. If that number is $50,000 or more, you should have an equity protection plan in place.
Why should you go beyond home title insurance?
One common misconception is that home title insurance will cover any issues that occur after you purchase your home. Most policies protect against past history up to the day you close on your property, but they do not cover future events. In addition to home title insurance, your bank, your homeowner's insurance and legal trust also do not protect against home title fraud.
Protecting your home's title is a two-step process: home title insurance for until the sale is completed, and then home title monitoring identity theft prevention services for any conveyances made after closing.
To help protect your home’s title, Home Title Lock monitors the title of your property 24/7. When new documents are recorded that could affect your property value or ownership, you'll be alerted in real-time. If potential fraud does occur, you’re not alone, as a team of experts are there to help you navigate the situation. The company also provides a free home title history report with initial sign-up, which allows you to see past activity on your property and learn if you're already a victim of home title fraud.
Where there's a will there’s a way
Another crucial step to protect your investment and ensure that your home will be in the right hands to help your legacy securely live on is careful estate planning, including preparing a will. This is one step that many people put off, especially when they are younger, assuming that it isn’t very likely it will be needed soon. However, the future is impossible to predict, so it’s vital to protect your family by taking this step as soon as possible. Creating an estate plan provides many benefits: It helps transfer assets with ease, and ensures that your beneficiaries receive what you intended, protecting your family's future.
With these steps, you can have peace of mind that your biggest investment — your home — is better protected.