Why we title insure every deal
First in a series
February 18, 2002

The Problem;

Fraud in the real estate industry is one of those nasty things that people just don't want to talk about.

'Let sleeping dogs lie' -is one commonly used expression that we, as lawyers hear all the time.

Notwithstanding those comments, fraud is a very real concern of ours. As realtors, it is something you should be concerned about too.

CMHC and CIMBL (Canadian Institute of Mortgage Brokers and Lenders) recently released a study* that revealed fraud in the real estate industry is a problem that cost $150-$300 million per year in Canada. Moreover, this number is double what it was over the last few years and CMHC and CIMBL believe 'this trend will continue into 2002 and that, without direct intervention, mortgage fraud will continue to increase at an accelerated rate'
The CMHC/CIMBL report concluded as follows; "In a competitive and automated world, it is becoming increasingly difficult to "Know Your Client". This, and a lack of reporting mechanisms and enforceable penalties, has presented greater opportunities to perpetrate mortgage fraud in a relatively risk free environment".

What this means to Realtors;

Fraud hurts real people. Make no mistake - it is a very real problem in our community. The last thing you want is to be involved innocently in a transaction where your clients become fraud victims and lose their life savings. Lawsuits inevitably emerge and it is reasonable to assume that when the accusations start to fly, you will get involved, justified or not.

One reason why we are the leading law firm in our market;

We title insure every deal.

The policy of title insurance that we arrange from First Canadian Title includes coverage for fraud and forgery issues relating to title. This means that our clients are protected from title related fraud because we arrange this protection for them. We do this on every deal we process because we want our clients to have the very best protection possible and to benefit from our knowledge of what is in their best interests when they entrust something as important as the purchase of a home to us.

The prospect of liability to the innocent realtor is reduced -because the title policy we obtain introduces a primary liability assumer into the process.

You may rest assured that any clients you refer to our firm will benefit from this protection -we title insure every deal we do!

Interested in learning more about what's involved in buying or selling? Check out the Consumer door of our web site, www.kormanassociates.com

Interested in learning more about market conditions and Practice and Legal Tips for Realtors? Check out the Realtor door of our web site, www.kormanassociates.com

Interested in books on real estate? Check out Howard Turk's best selling book, "HOMEfree, Everything You Need to Know about Buying and Selling a Home", or Howard's newest book, "House Rich : Your Home as Your Best Investment" -published by Prentice Hall Canada and available in bookstores across Canada.

Korman & Associates is one of Canada's leading real estate law firms, closing thousands of transactions annually. Put our experience to work for you!

Korman, & Associates
Barristers & Solicitors
905.270.6660
Realtor Hotline 905.602.6515

* Canadian Mortgage Industry Fraud White Paper. Prepared by CIMBL Mortgage Industry Fraud Task Force October 26, 2001