Real Estate Council of Alberta Fundamentals Practice Exam

What does title fraud involve?

1. Acquisition of rental properties

2. Transfer of property from the legitimate owner

3. Providing financing to buyers

4. Repairing damaged properties

The correct answer is: Transfer of property from the legitimate owner

Title fraud involves the unlawful transfer of property from its legitimate owner to another party. This can occur when an individual fraudulently assumes the identity of the property owner or uses forged documents to create a misleading image of ownership. The key aspect of title fraud is that it disregards the rightful ownership of the property, allowing the fraudster to wrongfully claim ownership and potentially sell or encumber the property without the knowledge of the legitimate owner. The other choices do not accurately reflect the nature of title fraud. Acquisition of rental properties relates to legitimate real estate transactions, providing financing to buyers involves the typical process of mortgage lending, and repairing damaged properties pertains to maintenance and renovation processes, none of which inherently involve fraud or illicit transfer of ownership.