Bulletin: VA2009001

Date:
March 26, 2009
To:
All Virginia Issuing Offices
RE:
New Statute of Limitations on Deeds of Trust

Dear Associates:

Senate Bill 1291 modified last year's change to the statute of limitations on the enforcement of the liens of deeds of trust, §8.01-241, Code of Virginia. Effective last July 1, the limitation was reduced from 20 years beyond the maturity date to 10 years beyond the maturity date. Effective March 16, 2009, the lien of any deed of trust which matured between July 1, 1988 and July 1, 2000, has the lien extended to July 1, 2010, after which no such lien may be enforced against the property. The modification applies only to deeds of trust which matured between the stated date; any deed of trust which matured on July 2, 2000, and later is subject to the newer 10-year limitation. Therefore:

Maturity date prior to 7/1/1988: lien has already expired.

Maturity date from 7/1/1988 to 7/1/2000: lien will expire 7/1/2010

Maturity date after 7/1/2000: lien will expire 10 years after maturity date.

The bill contained an "emergency" provision by which it became effective immediately upon being signed into law (March 16), and was made retroactive to July 1, 2008. THEREFORE, YOU MUST REQUIRE THE RELEASE OF ANY DEED OF TRUST WHICH MATURED BETWEEN JULY 1, 1988, AND JULY 1, 2000. (Note that this has the effect of imposing a 22 year statute of limitations on certain deed of trust liens.)

There is one important exception to the new statute: anyone who relied on the 10-year statute between July 1, 2008, and March 16, 2009, in acquiring any interest in property (including new deeds of trust) will not have their rights affected by the change, and those interests will have priority over, or be free of, the lien of the unreleased deed of trust, as the case may be under the laws of the Commonwealth as they existed during that period of time.

PLEASE NOTE: As was the case with the change in the law in 2008, deeds of trust with no stated maturity date, credit line deeds of trust with no stated maturity date, and deeds of trust insuring loans from government entities are not affected by this and retain the original limitations period for those liens.

If you have questions relating to this bulletin, please contact your Virginia Underwriting Personnel or Stewart Legal Services.

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

THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER  AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.

References

Bulletins Replaced:
None
Related Bulletins:
VA2008001 New Statute of Limitations on Deeds of Trust
Underwriting Manual:
None
Exceptions Manual:
None
Forms:
None