Pillar 1 - Licensing

Title License

Both Attorneys and lay settlement agents are permitted to conduct real estate closings within the Commonwealth of Virginia. The individual and the entity/agency must be registered with the Virginia Bureau of Insurance and/or Virginia State Bar. Licensure and continuing education requirements differ for attorneys and lay settlement agents.

Note that in Virginia, an attorney may conduct a real estate settlement without a title insurance license, however the attorney may not underwrite the title policy without a title insurance license. Lay settlement agents are not permitted to conduct a real estate settlement without a title insurance license. In addition to individual lay settlement agents, lay settlement companies must be RESA registered. 

Virginia Licensure at a glance

 

 

Attorney

Lay Settlement Agent

Licensure

Commercial Settlement

Must maintain active standing with the Virginia State Bar as a licensed attorney

Must complete a 16.0 hour title insurance pre-licensing course and pass the title insurance licensure examination; must register as a title insurance agent with the Virginia Bureau of Insurance. For lay settlement agents, the title insurance license is the only requirement for qualifying as a settlement agent, however lay agents are strongly cautioned against the Unauthorized Practice of Law (UPL). VLTA recommends that all lay agents hold the Virginia Certified Title Settlement Agent (VCTSA) designation.

Residential Settlement

Must register as a RESA attorney, see below

Issuance of title insurance

Must complete a 16.0 hour title insurance pre-licensing course and pass the title insurance licensure examination; must register as a title insurance agent with the Virginia Bureau of Insurance.

Continuing Education

 

12 hours each year, with at least 2 in Legal Ethics or Professionalism

16 hours each biennium, with at least 3 in law/regulations or ethics

 Fidelity Bonding

 

$100,000

$100,000

E&O Insurance

 

$250,000 (additional coverage may be required for large transactions)

$250,000 (additional coverage may be required for large transactions)

Audit

 

Annual RESA audit required if conducting residential settlements

Annual RESA audit required to maintain title insurance license

Background Checks

 

Prior to the issuance of a title insurance license, a criminal and financial background check are required by the state

Prior to the issuance of a title insurance license, a criminal and financial background check are required by the state

 

Obtaining Licensure. The Commonwealth of Virginia requires that all settlement agents be “licensed, bonded, and insured” prior to conducting a residential real estate settlement. Both attorney settlement agents and lay agents must satisfy a bonding requirement (minimum $100,000), maintain active Errors and Omissions Insurance (minimum $250,000), and obtain an appointment from a title insurance underwriter active within the Commonwealth (if they underwrite the insurance). Underwriters typically require that all agents, whether attorney or lay agents, pass a rigorous financial and criminal background check prior to appointment. The Virginia Bureau of Insurance also requires that any agency conducting real estate settlements undergo an annual RESA audit, which may be performed by the underwriter with which the agency or attorney has an agreement.

Attorneys - Attorneys must register with the Virginia State Bar Association to conduct residential closings (RESA registration) and maintain an active license to practice law within the Commonwealth. Attorneys wishing to issue title insurance must obtain a title insurance license. Attorneys may perform commercial settlements without additional licensure or registration. For additional information on licensure and education requirements for RESA attorneys in Virginia, visit http://www.vsb.org/site/regulation/real-estate.

Lay Agents - Lay settlement agent title insurance licenses are regulated by the Virginia Bureau of Insurance, and must comply with a series of requirements to obtain a title insurance agent’s license. Effective July 1, 2008, the Commonwealth of Virginia requires that lay settlements agents making an application for a title insurance license must complete a 16 hour pre-licensing education course as set forth in the Code of Virginia § 38.2-1814.1. Upon completion of the class, agents must pass, within 1 year, a title insurance examination proctored by the state.

Continuing Education. Both attorneys and lay agents are required to satisfy mandatory continuing education through their respective regulatory agencies to maintain licensure.

Attorneys - For attorneys conducting real estate settlements in Virginia, the requirements is 12 credit-hours of continuing education in each year, with 2 hours within the domain of Legal Ethics or Professionalism. For additional information on licensure and education requirements for RESA attorneys in Virginia, visit http://www.vsb.org/site/regulation/real-estate.

Lay Agents - For lay agents, the requirement is 16 credit-hours of continuing education each biennium, with 2 hours within the domains of Ethics or Law/Regulations. The biennial cycle begins in odd-numbered years, and ends in even-numbered years. For additional information on licensure and education requirements for lay settlements agents in Virginia, visit http://www.asisvcs.com/indhome.asp?CPCat=CE53INS.

Certification. In addition to these requirements, Virginia Land Title Association strongly recommends additional education for both settlement agents and title examiners. The Association offers two certification programs, including the Virginia Certified Title Settlement Agent (VCTSA) and the Virginia Certified Title Examiner (VCTE) which provide targeted education to local industry professionals and offer a credible minimum standard of professionalism within these fields. Professionals completing these programs have received an additional 16 credit-hours of education, have passed a rigorous examination, and must complete 16 credit-hours of continuing education each biennium to maintain certification status. To date, over 400 professionals within the Commonwealth have sought and obtained certification status. For more information about certification requirements of Virginia’s land title professionals, or to view a list of certified professionals visit www.vlta.org

Other Licenses

In Virginia, businesses conducting real estate settlements must also maintain a variety of other licenses in addition to the Title Insurance License. These licenses cover a variety of aspects of the operation of a real estate settlement shop and include the following:

State Business License

Business licenses in Virginia are governed by the State Corporation Commission (SCC). Entities must be registered through the Virginia SCC, which requires a one-time fee and the filing of an annual report. Businesses can be verified through the SCC’s online entity search using the full name of the business, or a portion of the business name at https://sccefile.scc.virginia.gov/Find/Business.

Local Business License

Many local jurisdictions in Virginia require a local business license, including the payment of local business or BPOL taxes. To verify the proper registration of a business in its local jurisdiction, it is advisable to visit the homepage of the unique jurisdiction. NOTE: Only some jurisdictions in Virginia require payment of BPOL taxes on title insurance premiums collected. A complete listing of these jurisdictions is not available, and in many cases is in dispute.

ALTA Policy Forms

To use the forms issued by the American Land Title Association for real estate settlements, businesses must maintain a current ALTA Policy Forms license, which is described at http://www.alta.org/membership/Intro.cfm. This license can currently be purchased for $195, or can be obtained as a benefit of ALTA membership. Evidence of either should be sufficient to demonstrate policy forms licensure.

Agency Agreement with VA registered Underwriter

Agencies must have a written agreement with an underwriter authorized to conduct business in the Commonwealth of Virginia. A listing of such underwriters is available through the Virginia Bureau of Insurance at http://www.scc.virginia.gov/boi/ConsumerInquiry/SearchPage.aspx?searchType=company. The agency agreement should clearly outline the requirements of the Agency and the terms of the underwriter. Any and all amendments to this agreement should be kept on file at both the agency and the office of the underwriter. All terms of the agreement must comply with both Federal and State law.

Notary Public License/Designation

For any real estate settlement office, notaries public must be registered and approved by the Commonwealth of Virginia. An application fee of $45 is required by the state. Approved applications incur an additional $10 fee at the time of swearing in, due and payable to the local Clerk of Court.

Notaries public may qualify under two designations: Traditional and Electronic. All notaries must first qualify as traditional notaries public.

The requirements for notaries in Virginia are set forth in the Notary Public Guidebook located at https://commonwealth.virginia.gov/media/3042/2014-july-handbook-final.pdf. Generally, notaries must satisfy the following conditions:

“(1) at least eighteen years old, (2) must be a legal resident of the United States, and (3) must be able to read and write the English language. (4) No person who has ever been convicted of a felony under the laws of the United States or this Commonwealth, or the laws of any other state, shall qualify to be appointed and commissioned as a notary public unless such person has been pardoned for such felony or has had his rights restored. Non-residents of Virginia may be appointed as notaries if they are regularly employed in the state and perform notary services in connection with their employment. A non-resident notary who ceases to be regularly employed in Virginia must surrender his or her commission.”

Those seeking approval as an electronic notary must purchase an electronic seal from such a provider. Traditional notaries are permitted to charge up to $5.00 per paper transaction; electronic notaries may charge up to $25.00 per transaction.  A notary’s commission is for a term of four years, expiring on the last day of the month in which the notary was born. The commission may be renewed every fourth year by filing a new application with the Secretary of the Commonwealth.

Recommendations

When reviewing satisfaction of Pillar 1 in Virginia, it may be prudent to explore the following:

  • Title Insurance License (if lay-agent or attorney underwriter) or RESA Registration (if attorney)
  • State Business License, fees, and reporting
  • Local Business License, BPOL and other taxes
  • Agency Agreement(s) with Underwriter(s)
  • ALTA Policy Forms License or Membership
  • Notaries Public Designations/Licenses

For vendors addressing Pillar 1 click here (coming soon!)

Continue to Pillar 2