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Estimate Title Costs →The buyer chooses. Virginia law gives the purchaser or borrower the right to select the settlement agent that handles escrow, closing and settlement, and a seller may not require a particular settlement agent as a condition of the sale (Va. Code § 55.1-1006). The purchase contract for a home of one to four units has to say so in bold type (Va. Code § 55.1-1007).
Federal law adds a second protection. When the purchase is financed with a federally related mortgage loan, which covers nearly every home loan, the seller can't require the buyer to buy title insurance from a particular title company as a condition of the sale. A seller who does is liable to the buyer for three times the title insurance charges (RESPA section 9, 12 U.S.C. § 2608).
What a Virginia seller can and can't do
- Suggest a settlement company. The buyer is free to accept the suggestion or pick another.
- Hire the seller's own Virginia attorney for deed preparation, fee negotiation, document review and legal advice about the closing (Va. Code § 55.1-1006).
- Negotiate in the contract who pays which costs, including the owner's title policy, which the buyer customarily pays in Virginia.
What the seller can't do is make its preferred company a condition of the sale. That stays true when the seller offers to pay for the owner's policy: the offer may be a good reason for a buyer to accept the seller's choice, but it isn't a way around the buyer's right to make it.
How the lender fits in
The lender doesn't choose the settlement agent either, but it sends its loan documents and closing instructions to the agent and requires a lender's title policy. Many lenders review a settlement agent before working with it, so tell the loan officer which company you've chosen as soon as the contract is ratified.
How to choose a settlement agent in Virginia
- Compare full written quotes. The state doesn't fix title premiums: insurers set their own rates and can negotiate them (Va. Code § 38.2-4608), and settlement, search and exam fees vary too.
- Ask which title insurers the agent writes for, and whether a reissue credit applies if the seller has an owner's policy.
- Check responsiveness before you commit: who your contact is, how quickly questions get answered, and how wiring instructions are confirmed.
- Decide at contract time. Name the settlement agent in the contract and tell your agent and lender the same day.
Will Rapuano and the Pruitt Title team handle title and settlement across Northern Virginia, Maryland and DC. To have them on your purchase, name Pruitt Title as the settlement agent when you sign the contract. Estimate your costs first with the Virginia closing cost calculator.
Title insurance in Virginia: owner's policy vs. lender's policy
Title insurance covers losses from problems with ownership that already existed before you bought the home: things like old liens, unpaid real estate taxes, forged signatures in an earlier deed, or someone else's claim to the property. Virginia law defines it as insurance against loss from liens, encumbrances, defects in title and other matters affecting title (Va. Code § 38.2-123). For what it costs, see our guide to title insurance in Virginia.
There are two separate policies, and they protect two different people:
- Lender's policy (also called a loan policy): protects the lender's mortgage. The coverage amount is based on the loan, it goes down as the loan is paid down, and it ends when the mortgage is paid off. If you refinance, the new lender will require a new one. According to the Virginia Bureau of Insurance, a buyer's lender will require a loan policy.
- Owner's policy: protects you, the buyer, for the claims listed in the policy. It stays in effect as long as you or your heirs own the property, it can't be transferred to the next owner, and it's bought for the full value of the home, which is usually the sales price.
The owner's policy premium is a one-time charge paid at closing. There is no monthly or yearly bill. Coverage takes effect as of the date the deed is recorded in the local land records.
The owner's policy is optional, but Virginia makes sure you're asked. Before any money is disbursed on a residential purchase, the settlement agent must get your written statement that you were told you may want owner's title insurance (including affirmative mechanics' lien coverage, if available) and whether or not you want it (Va. Code § 38.2-4616). The lender's policy protects only the lender, so if you skip the owner's policy and a covered title problem shows up later, the lender is protected and you are not.
Who sets title insurance rates in Virginia?
The state does not set one price. The Bureau of Insurance says title insurance companies set their own rates and can negotiate the rate with any potential insured, and it encourages buyers to shop around. Virginia law requires the underlying risk rates to be reasonable, adequate and not unfairly discriminatory, and it expressly allows a title company or title agent to charge rates it negotiates with you (Va. Code § 38.2-4608). Search, exam, settlement and similar service fees are separate from the insurance premium, so when you compare quotes, compare the whole list of charges, not just the premium.
In Virginia, the buyer customarily pays for the owner's policy. That's local practice, not law, so it can be negotiated in the contract. If the seller bought an owner's policy when they purchased the home, ask about a reissue credit, which may lower your premium.
How to get title insurance in Virginia
You don't buy title insurance on your own the way you buy homeowner's insurance. It comes through the closing. Here's the usual order of events:
- Choose your settlement agent. As the buyer (or borrower), Virginia law gives you the right to pick the settlement agent, and the seller can't require a particular one as a condition of the sale (Va. Code § 55.1-1006). Your sales contract for a home of one to four units must say this in bold type (Va. Code § 55.1-1007).
- Ask which title insurers they write for. The Bureau of Insurance says you choose the title insurance company too, but the settlement agent may be appointed with only one or a few title companies, so ask which ones they represent.
- Open title as soon as the contract is ratified. Send the settlement agent the signed contract, your lender's contact information (if you're financing) and the seller's contact information. Ordering title insurance is one of the settlement services the agent handles (Va. Code § 55.1-1000).
- Title search. A title company, title agency, title abstractor or attorney searches the land records for the chain of title, liens, unpaid taxes, mortgages and other matters affecting the property.
- Title commitment. The title insurer issues a commitment: a preview of the policy that lists the requirements that must be met before it will insure (for example, paying off the seller's mortgage) and the exceptions the policy won't cover (for example, recorded easements or HOA covenants). Read it and ask questions before closing.
- Decide on the owner's policy and sign the notice. Before closing funds go out, you'll sign the owner's title insurance notice required by Va. Code § 38.2-4616 saying whether you want an owner's policy.
- Closing and recording. You sign, funds are disbursed, and the deed and any deed of trust are recorded. Coverage is effective as of recording.
- Policy delivered. After recording, the settlement agent sends the recorded deed and the title policy to you (both are listed as settlement services in Va. Code § 55.1-1000). Keep the policy with your deed.
You can confirm that a title agent or title insurance company is licensed through the Bureau of Insurance's Consumer Services Section (1-877-310-6560) or its online search.
Buying a home for sale by owner (FSBO) in Northern Virginia
Buying straight from an owner, with no listing agent, doesn't change the rules above. You still have the right to choose the settlement agent, you still get the owner's title insurance notice, and if you're taking out a mortgage your lender will still require a lender's policy. What changes is that nobody is steering the paperwork, so you have to start it yourself.
Do you need a title company or settlement agent for a FSBO purchase?
If you're financing, in practice yes: your lender sends its loan instructions to the settlement agent and requires a lender's policy. For home sales of up to four units, only certain people can act as the settlement agent: a Virginia-licensed attorney, a licensed title insurance company, a licensed title insurance agent appointed by a title insurer licensed in Virginia, a licensed real estate broker, or a financial institution (or its subsidiary or affiliate) authorized to do business in Virginia, and none of them can have an unrestored felony conviction (Va. Code § 55.1-1003 A). Settlement agents covered by the law must be registered with their licensing authority, such as the State Corporation Commission for title agents or the Virginia State Bar for attorneys (Va. Code § 55.1-1014).
The law does let a party to the transaction handle settlement services themselves (Va. Code § 55.1-1003 B), but a cash FSBO buyer who skips a settlement agent also skips the title search, escrow handling and title insurance that come with one. Before doing that, confirm with a Virginia real estate attorney.
Keep in mind that a settlement agent cannot give legal advice unless it's an attorney you've hired for that purpose (the contract disclosure in Va. Code § 55.1-1007 says so). On a FSBO deal, where there may be no agent drafting or reviewing the contract, it can make sense to have a Virginia real estate attorney review the contract and deed. The seller may also hire their own attorney for deed preparation and advice (Va. Code § 55.1-1006).
Why the owner's policy matters more on a FSBO deal
Without agents on either side, fewer people have looked at the seller's paperwork before you sign. The title search and commitment are where problems like an unreleased old mortgage, a judgment lien against the seller, or a co-owner who hasn't signed usually surface. The lender's policy covers only the lender. The owner's policy is what protects your ownership after closing.
Steps to open title on a FSBO purchase
- Get a written, signed purchase contract. Confirm with a Virginia real estate attorney that it includes the required choice-of-settlement-agent disclosure and covers who pays which costs.
- Choose a settlement agent and confirm it's registered. Get fee quotes from more than one and compare the full list of charges.
- If you're financing, tell your lender who the settlement agent is right away.
- Send the settlement agent the contract, both parties' contact information, the seller's mortgage lender (for the payoff) and any HOA or condo association details.
- Review the title commitment, then decide on the owner's policy and sign the § 38.2-4616 notice before closing.
- Close, let the settlement agent record the deed, and keep the title policy when it arrives.
For agents: guiding a buyer's choice
- Explain the buyer's right to choose at the first meeting, before a seller's preference comes up.
- When the seller proposes a company, get its full fee quote and compare it line by line with the buyer's choice.
- Tell the lender the chosen settlement agent as soon as the contract is ratified.
- Name the settlement agent in the contract so there's no confusion at closing.
Compare quotes from more than one registered settlement agent before your buyer commits.
Frequently Asked Questions
What if the seller's agent insists on using their title company?
In Virginia, the buyer has the legal right to choose. While the seller's agent can advocate for their preferred company, they cannot make it a condition of the sale. If they're pushing hard, it might be a red flag. Stand firm, protect your buyer's right to choose, and be prepared to explain why your preferred partner is a better fit for the transaction.
My buyer wants to shop for the cheapest title company. Is this a good idea?
While it's smart to be cost-conscious, choosing a title company based solely on price is a mistake. Virginia doesn't set title insurance prices. Title insurers set their own rates and can negotiate them (Va. Code § 38.2-4608), and service fees vary too, so compare full written quotes. The difference in service, however, can be massive. A cheap, inexperienced, or unresponsive title company can cost your buyer far more in the long run through delays, errors, and stress.
What's the difference between owner's title insurance and lender's title insurance?
Lender's title insurance protects the lender's mortgage. Mortgage lenders require it, and its coverage goes down as the loan is paid off. Owner's title insurance protects the buyer's equity in the property. It's optional, and Virginia requires the settlement agent to get the buyer's written statement on whether they want it before closing funds go out (Va. Code § 38.2-4616). Skipping it leaves the buyer's ownership unprotected. It protects them from hidden claims, forgeries, and other title defects that could surface years down the road.
I'm the listing agent. How can I increase the chances of the buyer using my preferred title company?
The best way is to have the seller offer to pay for the owner's title insurance policy. This can be a powerful incentive. You can also provide the buyer's agent with a fee quote from your preferred company early in the process, highlighting their competitive pricing and excellent service. But remember, you can't require them to use your choice. It's all about negotiation and demonstrating value.
Do I need title insurance for a sale by owner in Northern Virginia?
If you're getting a mortgage, your lender will require a lender's policy. The owner's policy is optional, but it's the only one that protects you, and before closing the settlement agent must get your written statement saying whether you want it (Va. Code § 38.2-4616). On a FSBO deal, with no agents reviewing the seller's paperwork, the owner's policy is worth serious thought.
How do I get title insurance in Northern Virginia?
Through your closing. Choose a settlement agent (Virginia gives the buyer that right under Va. Code § 55.1-1006), send them the ratified contract to open title, review the title commitment after the search, and choose whether to buy an owner's policy. The premium is paid once at closing and the policy is sent to you after the deed is recorded.
Is title insurance required in Virginia?
No Virginia statute requires a buyer to buy an owner's policy. Lenders require a lender's policy on a mortgage. The owner's policy is your choice, and Virginia requires the settlement agent to tell you about it and get your written yes or no (Va. Code § 38.2-4616).
What title company should I use to buy a home directly from the owner?
Any settlement agent allowed under Va. Code § 55.1-1003 and registered as required by § 55.1-1014: a licensed title insurance agent or company, a Virginia attorney, a licensed real estate broker or an authorized financial institution. As the buyer you choose, and the seller can't make a particular settlement agent a condition of the sale (§ 55.1-1006). Compare fee quotes and check responsiveness before you commit.
How much does title insurance cost in Virginia?
Virginia doesn't set one statewide price. Title insurers set their own rates, can negotiate with you, and must keep risk rates reasonable, adequate and not unfairly discriminatory (Va. Code § 38.2-4608). Ask for a written quote that lists the premium and every service fee, and ask about a reissue credit if the seller had an owner's policy.
Who pays for the owner's title insurance policy in Virginia?
The buyer, by custom. The Virginia Bureau of Insurance notes that local practice, not the law, decides who pays, so it can be negotiated in the contract. Paying for it doesn't give the seller the right to require a particular settlement agent (Va. Code § 55.1-1006).
General information about title insurance and closing costs in Virginia, Maryland and DC, not legal or tax advice. Tax rates, fees and rules change, so confirm the figures for your own transaction.
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