Bulletin: VA2023002

Dear Associates:

Code of Virginia §64.2-621, et seq., The Uniform Real Property Transfers on Death Act, established and set out the requirements for Transfer on Death Deeds, also known as TODD’s. Stewart’s underwriting requirements were previously described in Bulletin VA2021003. The purpose of this bulletin is to update Stewart’s requirements, particularly in regard to: 1. the need for spousal joinder on TODD’s, and 2. removal of the requirement to review a List of Heirs of the Transferor. Depending on the transaction type and whether the original Transferor under a TODD is still alive, Stewart Title Guaranty Company has the following requirements for insuring these transactions:

A. Refinance: If the Transferor of a TODD is refinancing the subject property, the recorded TODD does not need to be released of record. You may simply insure the new lender as you would in any refinance.

B. Sale or Conveyance if the Transferor Is Still Alive: Section 64.2-630 sets out the specific requirements to revoke a TODD. Subsection (A) (1)(d) states a TODD may be revoked by “An inter vivos deed that expressly revokes the transfer on death deed or part of the transfer on death deed.” Consistent with this section, in any sale or conveyance with the Transferor still alive, the TODD must be revoked. This can be accomplished by a recitation in the deed of conveyance that the Transferor is revoking the prior TODD in its entirety.

C. Sale or Conveyance After the Transferor is Deceased: If the Transferor is deceased, the following procedures must be followed, and title commitment boilerplate language must be used:

1. You must email a copy of the recorded TODD to your Stewart underwriter.
2. Your email must include confirmation that title to the property to be insured has been searched in the name of the Transferor, and the TODD was not revoked by any subsequent deed, instrument or revocation, or other written instrument recorded prior to the death of the Transferor.
3. Your email must include confirmation that the Designated Beneficiary did not make a timely disclaimer of the subject property.
4. Your email must confirm that if the Transferor was married at the time the TODD was granted, that the Transferor’s spouse joined in the TODD.
5. Your binder must include the following requirements:
    a.) Proof of death of _________________,Transferor,
    b.) Approval of transfer on death documentation by Stewart Title Guaranty Company Underwriting.
6. With respect to insuring a sale/transfer within one year from the date of death of Transferor/Decedent, exception must be taken to the following: a) possible claims of creditors of said Transferor/Decedent, or against said estate; b) possible claims for expenses of administration of estate or funeral bills; and c) possible claims by surviving spouse and/or children for statutory allowances and exemptions.
7. In regard to possible federal and/or state estate taxes, please follow the guidelines set forth in Bulletin VA2019001, which you will find linked below.
8. To insure without taking exception to the above claims, Stewart requires the execution by the Designated Beneficiary of a Stewart Title Guaranty Company Indemnity Agreement (either testate form or intestate, as applicable), and one of the following:
   a. Collect the extra-hazardous premium amount of $2.00 of the gross sale price and remit same immediately after closing to your local Stewart underwriter, together with the original Indemnity and Escrow Agreement and a copy of your title policy.
   b. Retain the net proceeds, AFTER inquiring prior to settlement with your local Stewart underwriting office about the disposition of sales proceeds. Title agents are not permitted to hold escrows on behalf of Stewart without permission of underwriting counsel. Please check with your local Stewart office to determine if there is an escrow fee for that service. Enter the amount of the net proceeds where indicated on the Indemnity and Escrow Agreement.

Please see Bulletin VA2019001 for further details and forms relating to “Open Estates”.

If you have any questions relating to this or other bulletins, please contact a Stewart Title Guaranty Company underwriter.

For on-line viewing of this and other bulletins, please log onto www.vuwriter.com.

VA Estate Indemnity--Intestate
VA Indemnity and Escrow Agreement--Testate
VA Indemnity and Escrow--Intestate