Buying in Montpelier? New Ordinance Now In Effect

If you are closing on residential property in Montpelier, we’ve heard of a NEW Home Energy Information Ordinance which became mandatory on July 1, 2022. The Ordinance requires that:

• prior to listing any residential structure for sale, the seller obtain a Vermont Home Energy Profile Certification Statement and provide a copy to: their licensed real estate agent(s); all prospective buyers; the buyer at closing;
• at closing the parties must sign a certificate documenting disclosure and, within 10 days of closing, the seller must provide a copy of the signed certification to the City Clerk;
• a violator is subject to civil penalties which range from a warning accompanied by a timeline for compliance to civil penalties from $25 up to $500;
• In addition to enforcement procedures available before the Vermont Judicial Bureau, the City Manager is authorized to commence a civil action to obtain injunctive relief and other appropriate relief, or to pursue any other remedy authorized by law.

The kicker? After all of that, the Ordinance does expressly make clear that: “Under no circumstances shall the civil penalty imposed … constitute a lien on the real or personal property of the Seller or his or her successors in title. Nothing in this ordinance shall be interpreted to create a cloud or impediment on the title.”

For more information we recommend reaching out to the City Clerk or municipal official. 

Payoff Procedures for HELOCs

We have noticed an increased number of HELOCs (Home Equity Line of Credit) when reviewing commitments. This is a reminder to follow proper payoff and account closure procedures for HELOCs, particularly when there are mergers of financial institutions, since it may take more time to obtain proper payoffs during the transfer of accounts to servicers. 

If a HELOC is not properly terminated, the account holder might draw on the account after a sale or refinancing, allowing the unreleased HELOC to have priority over a subsequent mortgage.

Underwriting guidelines and the terms of a commitment require completion of the following steps to ensure that a HELOC account is closed and cannot be drawn upon:

• Obtain a current, written payoff statement from the lender or servicer of record. The payoff letter needs to include the payoff amount with principal, interest and any fees due by a date certain along with a per diem amount;  
• Have the borrower and lender close the account via the form required by the lender (often sent with the payoff letter). This may require having the borrower sign a statement indicating that the account is to be closed or frozen, that no further advances will be permitted or such right has been terminated, and that the mortgage lien is to be released; 
• Notify the borrower when obtaining the payoff that they can no longer draw on the account once the payoff is obtained; and 
• Just prior to closing, contact the lender and confirm no further draws have been made on the account since the date of the payoff statement.

When your office represents a buyer and the seller’s title is encumbered by a HELOC, you must confirm the proper payoff and closure of the account. 

Should you have any questions, please email underwritingvt@catic.com to reach Andy and Liz.  

Municipal Clerk Oversight

As you vote for a new Secretary of State (the primaries are on August 9 – early ballot voting is available), you may be concerned about meaningful reform of Vermont’s municipal land records system. Think: standardized indexing and recording practices including oversight over 3^rd party vendors; training and certification for new clerks; oversight by a Land Records Office with enforcement powers; some form of standardized hours, etc. s you vote, please remember that:

• Candidate Chris Winters (currently the Deputy Secretary of State) participated in the 2022 legislative biennium and actively opposed meaningful oversight of Vermont's irreparably broken system. Candidate Winters was supported in opposing reform by the State Archivist, the Vermont Municipal Clerks and Treasurers’ Association, and the Vermont League of Cities and Towns;

• Candidate John Odum is currently the Montpelier City Clerk who circulated a region-wide petition (presented to the Governor’s office) misrepresenting CATIC’s Covid-related lawsuit in Superior Court;
• Only one candidate, Sarah Copeland Hanzas (former member of the Vermont House of Representatives), has not openly and actively opposed reform of our municipal land records system.



Please remember to vote. 

Post-Closing Update & Discharge Tracking Services -- IMPORTANT CHANGES

After several years of steady pricing, effective August 1, 2022, Vermont’s post-closing update fee will increase by $10.00 per order and the discharge tracking fee (for current seller/borrower Mortgages being paid off at closing) will increase by $5.00 per mortgage.

The new fees will be as follows: 

Discharge Tracking Service (current seller/borrower Mortgages being paid off at closing)

1.) If you are using the discharge tracking service, this authorization letter MUST be completed by the seller/borrower (if a refinance) prior to or at closing AND be included with your post-closing update request. This is in addition to a copy of the payoff statement. Without these two documents up-front, this service cannot be utilized.

2.) Update/discharge tracking invoices and fees will continue to be sent to our Vermont office.

We trust that you, your staff, and your clients have found our services worthwhile. Our goal in offering these services is to make your office more efficient, more productive, with reduced office overhead (e.g. valuable staff time and resources spent running around the land records multiple times or chasing lenders)!

What we can definitively tell you is that performing post-closing title updates SERIOUSLY reduces insurance and malpractice claims. A significant percentage of the claims that we process are a direct result of an office NOT performing a post-closing title update and/or NOT catching a potentially “fixable” problem in time – e.g. before a bankruptcy or foreclosure hits.

Lau's Corner & Title Tips

Wire Fraud - Vermont Alert

We recently learned of a Vermont real estate law office which was the victim of a SIX figure wire fraud. The money is gone-gone. No surprise – the fraud involved a change of wire instructions and the change was received via FAX. Upon belief, the changed instructions were not independently verified by a phone call to a known number. Do not assume any wire instructions are valid. Always verify wire instructions by phone. If you receive a revised set of wire instructions – whether by e-mail, by fax, or by any other delivery method – assume fraud is afoot.

CATIC's Annual Night with the Lake Monsters

Join fellow CATIC agents, their staff members, and family for a BBQ and an evening under the lights as the Lake Monsters take on the Worcester Bravehearts. 

We'll provide tickets to the game, BBQ dinner and $10 in ballpark spending money!

The details are as follows:

Date: August 5th

Time: Gates/BBQ open at 6:00pm; first pitch at 7:05pm*

Where*: Centennial Field (98 University Road, Burlington)

Who:  This event is free, and it is open to the Real Estate Departments of all active CATIC members and their families.

*We'll meet you at the gate with your tickets

Click here to reserve your tickets.

Dinner and Races - CATIC Night at Thunder Road

Have you always wanted to go to Thunder Road, the Nation’s Site of Excitement, but just haven’t gotten there (yet)? Or, are you a “regular,” craving another action-packed evening? Either way, join fellow CATIC members, staff, and their families for a free BBQ and an evening of summer, outdoor fun! We'll provide tickets to the race and will host a free BBQ under the Pavilion.

This exciting night of racing will also include the very popular “Run-What-U-Brung.” We will keep Andy off the track! Perhaps you’ve never seen a State Governor win a race – he may be racing.

We hope to see everyone at the “Road.” Details:

Date: August 25th

Time: Gates open at 5 p.m.; BBQ at 6 p.m.; Racing at 7 p.m.

Where*: Thunder Road (80 Fisher Road, Barre) - No racing on the way to the track!

What to Bring: Ear protection; bug spray; sense of adventure and appetite. Alcohol if you wish, but GLASS is NOT ALLOWED IN THE VENUE.

*We'll meet you at the main gate with your tickets.

Click here to reserve your tickets.