FBI issues warning to US homeowners with 100% paid-off mortgages — new update reveals major risk. Is your house exposed?

Jing Pan

Thu, September 10, 2026 at 1:55 PM GMT+3 8 min read

Photo by Nathan Posner / Anadolu via Getty Images

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For many Americans, paying off the mortgage is the ultimate financial finish line. After decades of monthly payments, the house is finally yours — free and clear.

But the FBI is warning that this hard-earned milestone could also attract the wrong kind of attention.

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Criminals are impersonating property owners and attempting to sell their real estate without their knowledge or consent — and properties without a mortgage or other lien can be especially attractive targets.

In other words, the clean title you spent decades working toward could be exactly what a fraudster is looking for.

And the threat is not merely hypothetical. In a recent federal case, three people were charged over their alleged roles in a multistate scheme involving approximately $1.5 million in illegal proceeds.

So, how can someone attempt to sell a property that belongs to you — and how would you even know it was happening?

How criminals can hijack your title

In a June 16 public alert (1), the FBI outlined a scheme built around a disturbingly simple idea: Criminals don't need to break into your property. They impersonate you instead.

First, fraudsters collect the owner's personal information. According to the FBI, those details can come from county or state websites, data brokers, stolen accounts, phishing schemes, the dark web or hackers.

Armed with that information, they can create fake driver's licenses or passports, open email accounts and use internet-based phone numbers to pose as the owner.

The impostor then contacts real estate agents and title companies, prepares contracts and attempts to put the property on the market.

By the time the real owner discovers what is happening, the property may have already been listed — or even sold — and the proceeds wired away.

The FBI's latest bulletin focuses on vacant property. But the agency's Boston field office previously warned (2) that scammers also comb public records for properties without a mortgage or other lien.

One likely reason is that an unencumbered property has no lender whose lien must be cleared at closing, potentially removing a checkpoint that could expose inconsistencies. And with no mortgage balance to repay, more of the fraudulent sale proceeds may be up for grabs.

These criminals are sometimes called "title pirates." They may use forged deeds or other documents to make it appear that ownership has changed, then sell the property, borrow against it or rent it out for their own gain.

The FBI said it has seen a steady increase in reports of quitclaim deed fraud.

On July 23, the U.S. Attorney's Office for the District of Massachusetts announced (3) charges against three people in an alleged scheme targeting vacant, unencumbered properties in Massachusetts, Georgia, Indiana and Tennessee.

Prosecutors say the conspirators used fake identification, email addresses and internet-based phone numbers to impersonate out-of-state owners, then tricked real estate professionals into selling their properties to unsuspecting buyers. One defendant allegedly defrauded property owners of approximately $1.5 million.

How to protect your property

The unsettling part of this crime is that an owner may not receive a suspicious phone call, email or knock at the door. The entire transaction can unfold between an impostor and real estate professionals.

That makes early detection critical.

The FBI recommends checking whether your county recorder, register of deeds, appraisal district or county clerk offers a notification service. These programs can send an automated email or text when a legal document is recorded using your name.

Property owners should also monitor online land records and create search alerts for their addresses. If the property is vacant or far from home, the FBI suggests driving by periodically, hiring a management company or asking a trusted neighbor to report suspicious activity.

Pay attention if your property tax or water bills suddenly stop arriving as well. An unexpected interruption could be a sign that account or ownership information has been changed.

Because this type of scheme often begins with identity theft, it may also be worth limiting how much of your personal information criminals can find online.

If you want some added peace of mind, platforms like Aura offer a way to safeguard your personal information.

The AI-powered service removes your personal data from Google search results, people-search sites and brokers that sell your data to advertisers. Aura can even scan the dark web and data breach sources for your credentials and alert you to any leaks of your data.

Aura also monitors spending patterns so you always know when a suspicious transaction pops up and if identity theft does happen, their $1 million insurance protection covers eligible losses and fees.

You could save up to 68% if you sign up today — and Aura even offers a risk-free, 60-day money-back guarantee.

The FBI also recommends reviewing your owner's title insurance policy to determine whether it includes post-policy protection. Some policies may cover forgery or the legal costs of clearing the title and restoring rightful ownership, but coverage varies.

That protection should not be confused with ordinary homeowners insurance. A standard home policy is generally designed to cover risks such as property damage, theft of belongings and liability — not someone fraudulently tampering with your title.

Still, the FBI warning offers a good reason to review all of your coverage rather than assume you are protected.

With a comparison platform like Insurify, you can instantly view quotes from top-rated providers, compare what different policies include and look for potential coverage gaps or additional options — all while checking whether you're paying a hidden "loyalty tax" to your current insurer.

Just answer a few basic questions and Insurify will show you the most affordable deals in as little as 3 minutes.

Not only is the process 100% free, but you could also save up to 15% by bundling your car and home insurance.

For buyers, FBI recommends sending a certified letter to the owner's address listed in the land-tax record to help confirm that the person selling the property is legitimate.

If you suspect fraud, report it quickly to the FBI's Internet Crime Complaint Center. The agency says it can work with partners to try to stop wire transfers and recover funds within the first 72 hours — making speed especially important.

Earn rental income without becoming a landlord

The FBI's warning highlights a risk many people never consider when buying property: The headaches of direct ownership can extend far beyond maintenance, repairs, mortgage payments, property taxes and 3 a.m. tenant calls.

Even so, real estate can still hold considerable appeal as an income-producing asset. High-quality rental properties can generate recurring income while potentially appreciating over time.

Real estate is also a time-tested hedge against inflation. When inflation rises, property values often increase as well, reflecting the higher costs of materials, labor and land. At the same time, rental income tends to go up, providing landlords with a revenue stream that adjusts for inflation.

Over the past ten years, the S&P Cotality Case-Shiller U.S. National Home Price NSA Index (4) has jumped by 87%, reflecting strong demand and limited housing supply.

Today, you don't need to buy a property outright, put your name on another deed or take on the day-to-day responsibilities of being a landlord to invest in real estate. Crowdfunding platforms like Arrived offer an easier way to get exposure to this income-generating asset class.

Backed by world-class investors like Jeff Bezos, Arrived allows you to invest in shares of rental homes with as little as $100, all without the hassle of mowing lawns, fixing leaky faucets or handling difficult tenants.

The process is simple: Browse a curated selection of homes that have been vetted for their appreciation and income potential. Once you find a property you like, select the number of shares you'd like to purchase and then sit back as you start receiving any positive rental income distributions from your investment.

Another option is Lightstone DIRECT, which gives accredited investors access to single-asset multifamily and industrial deals.

Lightstone DIRECT's direct-to-investor model ensures a high degree of alignment between individual investors and a vertically-integrated, institutional owner-operator — a sophisticated and streamlined option for individual investors looking to diversify into private-market real estate.

With Lightstone DIRECT, accredited individuals can access the same multifamily and industrial assets Lightstone pursues with its own capital, with minimum investments starting at $100,000.

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Article Sources

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Internet Crime Complaint Center (); Federal Bureau of Investigation (); U.S. Department of Justice (); S&P Global ()

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.