Buying or selling a home is one of the biggest transactions you will ever make. It is important to have the settlement team with the right experience with you during the process. Respected throughout the community with a wealth of expertise, buyers and sellers can rest assured that the transaction will go smoothly from start to finish with the Vesta Settlements team at the helm.
Buyers and sellers can use the resources in this section to get acquainted with the home buying process before they begin.
Title & Title Insurance
When you purchase a home, you are acquiring legal title to that property. Title is defined as the formal right of ownership of property.
In basic terms, title insurance is a policy that protects you against damage or loss resulting from defects that may exist in the title. These defects in title can result from things such as fraud, documentation errors, undisclosed heirs, liens or encumbrances on the title, and any other matter affecting the title to the property or the right to the use and enjoyment of property. A title search will help to identify these potential issues with the title. It is done by examining public records to look up the ownership history of the property and to assure the seller has saleable interest. However, even the best search, done by the most experienced title professional cannot guarantee that no title issues exist. Title Insurance will protect you against these unforeseen risks.
There are two types of title insurance, the Owner’s Policy and the Lender’s Policy, also called the Loan Policy. The Owner’s Policy is typically issued in the amount of the real estate purchase price. It is purchased for a one- time fee at closing and lasts for as long as the owner or his or her heirs retain an interest in the property or has any liability by reason of the covenants of title. The Owner’s Policy protects the purchaser against loss resulting from a defect in title. Without title insurance these issues become the problem of the property purchaser and could cause significant financial loss.
The Owner’s Policy can be purchased in two forms - Standard and Enhanced Coverage. The Enhanced Coverage costs slightly more but covers additional risks not covered under the Standard Policy (See chart for details).
The Lender Policy is typically a required policy and assures the lender of the validity, priority and enforceability of its lien (mortgage). The policy serves as protection for the lender’s security interest in the property. The Lender’s Policy is issued in the amount of the loan. If you are refinancing, you are obtaining a new loan and your lender will most likely require a new title search and new Loan Policy to protect their interest. You will not need to purchase a new Owner’s Policy.
What is Title? It is important to know what title is before discussing title insurance. Black’s Law Dictionary defines title as “the formal right of ownership of property.” Most contracts in Virginia require a seller to provide good and marketable title – title free from litigation, defects and grave doubts.
What is Title Insurance? Title Insurance is an agreement to indemnify against damage or loss resulting from a defect in title to real property. The Virginia Code defines title insurance as insurance against loss by reason of liens and encumbrances upon property, defects in the title to property, and other matters affecting the title to property or the right to the use and enjoyment of property. Title insurance includes insurance of the condition of the title to property and the status of any lien on property.
Why Do I Need Title Insurance? Title insurance is important to protect against unknown or unrecorded defects that may affect title to your property. Only an Owner's Policy fully protects the buyer should a covered title problem arise with the title that was not found during the title search. Possible hidden title problems can include errors or omissions in deeds, mistakes in examining records, forgery or undisclosed heirs.
What if I’m not able to physically attend closing? In this situation, you have a choice. You can either (a) give someone a power of attorney to sign on your behalf, or (b) arrange for documents to be sent to you for execution and send the originals back to our office. Option (b) is difficult to arrange for buyers who are financing their purchase.
When and how will I receive the proceeds from my sale? Under Virginia law proceeds from the sale must be sent within two business days from the closing date. We can send the funds by wire transfer, mailing a check or a check may be picked up from our office.
What is a closing disclosure? This form is a federally mandated form providing a detailed statement of the breakdown of costs involved in a real estate transaction.
What is the role of the Settlement Company? The Settlement Company orchestrates the logistics of a real estate transaction including the closing, examines the title to the subject property and issues the policy of title insurance.
What steps should I take if I want Vesta Settlements to handle my real estate closing? That’s easy. Just send us your ratified contract. You can email it to firstname.lastname@example.org. We’ll take it from there making sure to coordinate with all relevant parties.