About Nicole Ashley

Landmark Title, LLC is a full service title and settlement company serving buyers, sellers, realtors and lenders in the Greater Hampton Roads area. Landmark is a licensed in Virginia title insurance agency and a registered Virginia settlement provider. The company can also obtain title services and insurance for clients in conjunction with North Carolina transactions.
Purchasing a home is perhaps the largest investment many of us make in a lifetime. Don’t let hidden or unforeseen title problems relating to our property cause this important investment to be lost or impaired. Title claims are not new, they have been around for centuries. Abraham Lincoln and Daniel Boone are just a few of notable Americans who have lost their homes to title claims. Landmark title and its highly qualified staff are proud to carry on the tradition of offering professional and accurate closing services and superior title protection.

Don’t Give Up Control!

In the current real estate environment, foreclosures have saturated the market on a national and local basis.

As a result, you are almost guaranteed to come across a foreclosure sale on which one of your buyer clients might become interested in pursuing or writing an offer. foreclosure-signFor those of you who had the good fortune (or bad fortune depending upon your experience) to represent a buyer on a foreclosure transaction, you may have come across a unique and often confusing addendum being used by foreclosure settlement agents or listing agents. These addenda generally offer closing cost assistance, providing payment for owners and/or lender’s title insurance, in exchange for the buyer using the services of the seller’s settlement agent. The addendum may be requested before or after contract ratification and often after the amount of closing cost assistance has been negotiated on behalf of your client. However, even if such an addendum is not provided for your client’s signature, be sure to read through the contract in its entirety, as there may be verbiage buried within the contract calling for the same requirement. We have been made aware of instances where REALTORS® and their clients were asked to sign these addenda after contract ratification.  The clients refused to sign the addenda, and these transactions moved forward to closing without further incident. Therefore, it appears executing these addenda is not always required, so consult one of your brokers before proceeding.

These practices leave many wondering if these addenda or similar language found in some foreclosure sale contracts are RESPA compliant. This is open to interpretation by attorneys and seems to stretch the limitations and requirements provided by RESPA. However, it does appear they are offering this option (or strongly persuading depending on your view) to each and every buyer rather than discriminating among buyers or transactions.

If you run across such addenda, I encourage you to call the seller’s settlement agent prior to your buyers signing same or ratifying the contract in order to fully discuss your client’s options. It is never easy, and often uncomfortable, to put one’s faith in a settlement agent you’ve never used and who may be located hundreds of miles away. Several questions as to their familiarity with our state and local laws and title underwriting may arise that could delay closing, derail closing, or only come to light when your client(s) attempts to refinance or sell the property.

Signing a contract

It’s always important to make sure your client receives their owner’s title insurance policy within 60 days of closing regardless of who acts as settlement agent. However, in the world of “here today, gone tomorrow” settlement providers, making sure your buyers are dealing with a reputable local settlement provider you trust is more crucial than ever. The benefit to REALTORS® and their clients is control.  Foreclosure sales are already filled with many unknowns: Who is actually authorized to execute seller documents? What does anyone really know about the property? What happens to judgments and other liens found on title? Handing that control to the seller’s settlement agent allows them to answer all these questions to their sole satisfaction and proceed to closing (can you say CONFLICT?). We encourage you to keep the control you and your client benefit from on your other transactions. You can often find ways to provide the same services and insurance being dangled in front of your client’s eye while still using the agreed-upon closing cost assistance in foreclosure transactions. Advise your current settlement provider about what’s going on, and I believe they will be more than eager to assist you on all (not just one of) your transactions. They will continue to facilitate transactions on behalf of your clients without conflict.

Over the several months, Landmark Title has successfully closed buyer side foreclosure transactions without consequence when REALTORS® refused to have their clients execute these addenda. Buyers still were provided owners and lender’s title insurance coverage, and the costs of these policies were covered through seller closing cost assistance (even with the contract or an addendum stating otherwise). However, every transaction and the players and circumstances within them are different.   Ultimately, the decision is yours and your buyer’s, and we always recommend checking with one of your brokers and your customary closing agent before proceeding.

So remember, honor Choice, avoid Conflict, retain Control, and Close with Confidence.

About Nicole Ashley

Landmark Title, LLC is a full service title and settlement company serving buyers, sellers, realtors and lenders in the Greater Hampton Roads area. Landmark is a licensed in Virginia title insurance agency and a registered Virginia settlement provider. The company can also obtain title services and insurance for clients in conjunction with North Carolina transactions.
Purchasing a home is perhaps the largest investment many of us make in a lifetime. Don’t let hidden or unforeseen title problems relating to our property cause this important investment to be lost or impaired. Title claims are not new, they have been around for centuries. Abraham Lincoln and Daniel Boone are just a few of notable Americans who have lost their homes to title claims. Landmark title and its highly qualified staff are proud to carry on the tradition of offering professional and accurate closing services and superior title protection.