Yes: nearly every mortgage requires a lender’s title insurance policy, because the loan has to sit in first lien position and the investors and agencies behind the loan expect that position to be insured. The lender’s policy protects the loan balance, not you. The owner’s policy, which protects your equity, is a separate and optional purchase. This is the title insurance mortgage requirement in one paragraph; the rest of this article covers what it costs in Henrico County, how Virginia handles it, and the dollar math on a Short Pump purchase.
Written by Duane Buziak, NMLS #1110647 | Coast2Coast Mortgage LLC NMLS #376205
Why Every Mortgage Requires a Lender’s Title Insurance Policy
Title insurance protects against defects in ownership that exist before you buy: an unpaid contractor lien, a forged signature in an older deed, unpaid property taxes, a recording error, or an heir nobody knew about. Before a policy is issued, a title company searches public records, in Henrico’s case the land records at the Circuit Court, to trace ownership and find anything attached to the property. The policy then insures against the problems that search missed or could not reveal.
The requirement comes from the loan side, not from the law. No Virginia statute says a buyer must carry title insurance. But the loan’s lien must be in first position, and the parties who buy or guarantee mortgages want that position insured. Fannie Mae’s Selling Guide sets title insurance standards for loans it purchases, and FHA, VA, and USDA each require title evidence and a first-lien position under their own rules (covered program by program below). A broker cannot place a loan with a wholesale lender that has no insured lien.
The most common misconception is that this policy protects the buyer. It does not. The lender’s policy covers the loan balance only. If a hidden claim surfaces, the policy protects the lender’s recorded interest, and your down payment and equity are not covered unless you also buy an owner’s policy.
Two facts about the premium are worth knowing early:
- It is paid once, at closing. There is no monthly title insurance bill.
- Lender’s coverage shrinks as you pay down the loan and ends when the loan is paid off or refinanced.
Lender’s Policy vs. Owner’s Policy: Who Is Actually Protected
The two policies differ on nearly every point. The lender’s policy insures the lender named on the deed of trust. The owner’s policy insures you. The lender’s coverage equals the loan amount, while the owner’s coverage equals the purchase price. Lender’s coverage lasts until payoff or refinance, while the owner’s policy lasts as long as you or your heirs hold title. The lender’s policy is required on practically every financed purchase, and the owner’s policy is optional. In Virginia the buyer customarily pays for both, though who pays is negotiable in the purchase contract.
The owner’s policy matters because the lender’s policy disappears the day you refinance, while problems with your title do not. An old claim can surface years after closing. With an owner’s policy, the insurer investigates and defends the title, and pays covered losses up to the policy amount. Without one, you pay for the legal fight yourself.
A covered claim looks like this, described generically: a prior owner’s former spouse turns out to have signed a deed improperly, or a lien from work done before your purchase was never paid and never surfaced in the search. Either one can cloud your ownership after you have moved in. The owner’s policy exists for exactly that situation.
Buying both policies at the same time is called simultaneous issue, and it usually makes the lender’s policy cost a small fraction of what it would cost alone, so the owner’s policy is the larger line. The exact discount depends on the underwriter and the settlement agent, so confirm the figures with the settlement agent before you assume a number. The settlement agent is the company or attorney that runs the closing, holds funds, records documents, and issues the policies.
What Title Insurance Costs in Virginia and Henrico County
Virginia title insurance rates are set by the insurers and filed with the state, and the premium is based on the loan amount (lender’s policy) or the purchase price (owner’s policy). Because the rates are filed with the state, they should not vary much between title companies using the same underwriter. The fees around the policy are where quotes differ. For the current rate structure, check the Virginia State Corporation Commission’s Bureau of Insurance, and rely on your Loan Estimate for your own numbers as of 2026.
Price drives the size of the premium. Short Pump’s median home price runs roughly $520,000 to $527,000 in 2026, based on market trackers such as the Redfin housing market page for the 23059 ZIP code. A higher price means a larger owner’s policy and, usually, a larger loan and lender’s policy, so a home near Short Pump Town Center will carry a bigger premium than a starter condo elsewhere in the county.
Other title-related items appear on the same part of your closing paperwork:
- Settlement fee: the settlement agent’s charge for running the closing.
- Title search and examination: the records review described above.
- Recording fees: charged by the Henrico Circuit Court Clerk to record the deed and deed of trust.
- Grantor and recordation taxes: Virginia taxes tied to the transfer and the loan. Check the Virginia Department of Taxation or the Henrico Circuit Court Clerk’s fee schedule for current rates before budgeting.
On who pays: in Virginia the buyer customarily chooses the settlement agent and pays for the lender’s policy, but that is a custom, not a rule. A seller can agree to cover costs in the contract. VA and FHA rules also limit certain fees that a veteran or borrower can be charged, so the program you use can change how items are assigned. Your broker should check these against the contract before you sign it.
Worked Example: Title Costs on a $520,000 Short Pump Purchase
Suppose you buy a $520,000 home with an FHA loan and 3.5% down, which is $18,200. The base loan is $501,800. FHA’s upfront mortgage insurance premium of 1.75% ($8,781.50) can be financed, bringing the total loan to $510,581.50. The lender’s policy would be written for the loan amount and the owner’s policy for the $520,000 price.
The title and settlement figures below are illustrative estimates, not quotes. Your actual numbers come from your Loan Estimate.
- Owner’s policy: $2,200
- Lender’s policy (simultaneous issue): $400
- Settlement fee: $700
- Title search and exam: $400
- Recording fees: $150
- Illustrative subtotal: $3,850, before Virginia grantor and recordation taxes
On those assumptions, your down payment plus title and settlement costs comes to $22,050, before taxes, prepaid items, and other lender charges. A Dynamo DPA or Turbo DPA layered onto the same purchase reduces the cash you bring by whatever assistance you qualify for, subject to program terms that Duane Buziak confirms before you rely on them.
Closing costs can also be handled without paying them directly. A seller concession negotiated in the contract can cover them, within the limits of your loan program. A slightly higher interest rate can generate a lender credit that offsets them. Both are routes to no-out-of-pocket closing options, and each carries a trade-off: a higher price or a higher rate over time.
| Policy Type | Who It Protects | Coverage Amount in Example | Required? | Typical Duration |
|---|---|---|---|---|
| Lender’s policy | The lender named on the deed of trust | $510,581.50 (total loan with financed FHA UFMIP) | Yes, on nearly every mortgage | Until payoff or refinance |
| Owner’s policy | You, the buyer, and your heirs | $520,000 (purchase price) | No, but strongly worth considering | As long as you or your heirs hold title |
Title Insurance Requirements by Loan Program: FHA, VA, USDA, Conventional
Every major program requires evidence of clear title and a first-lien position, though each states it differently.
- FHA: HUD Handbook 4000.1 requires title evidence and an insured lien position, and the title provisions sit in its underwriting and closing sections.
- VA: the VA Lender’s Handbook requires the VA-guaranteed loan to hold first-lien position and sets rules on which closing charges a veteran may pay.
- USDA: requires a first lien and title evidence on the guaranteed loan.
- Conventional and jumbo: follow the investor’s title requirements. For 2026, FHFA’s announcement sets the baseline conforming limit at $806,500 and the high-cost ceiling at $1,249,125. Loans above the applicable limit are jumbo, with investor-specific guidelines.
DSCR, Non-QM, and Bank Statement loans also require lender’s title coverage. Private investors buying those loans want the same lien protection, so the requirement does not go away just because the underwriting is different.
A VA cash-out refinance allows up to 100% loan-to-value, which raises the stakes on accurate title work and lien payoffs. With almost no equity cushion, an unpaid lien or an inaccurate payoff figure matters more.
| Program | Down Payment | Title Requirement | Credit Floor | Soft Pull Available |
|---|---|---|---|---|
| FHA | 3.5% minimum with qualifying score | Title evidence and insured first lien per HUD Handbook 4000.1 | 580 for 3.5% down; 500 to 579 with larger down payment | Yes, with NoTouch Credit Pull |
| VA | 0% for eligible borrowers | First lien and title evidence per VA Lender’s Handbook | Down to 500 FICO through Duane Buziak’s wholesale lenders | Yes, with NoTouch Credit Pull |
| USDA | 0% in eligible areas | First lien and title evidence | Varies by lender and underwriting method | Yes, with NoTouch Credit Pull |
| Conventional | As low as 3% on some programs | Investor title standards, insured first lien | Generally 620 and up | Yes, with NoTouch Credit Pull |
| Jumbo and Non-QM | Varies by investor | Lender’s title coverage required | Varies by investor | Yes, with NoTouch Credit Pull |
How Duane Buziak Handles Title Differently Than Retail Lenders
The structural difference is shelf space. Retail lenders offer one set of terms. Duane Buziak is a broker with access to 500+ wholesale lenders, so he can compare loan options and their fee structures side by side, including how each treats title and settlement charges, before you commit to one.
Cost visibility comes early. NoTouch Credit Pull gives you a soft credit pull mortgage pre-approval, which means a no hard inquiry mortgage pre approval: a mortgage pre approval without hard pull that you can complete with a soft pull mortgage broker. Because it is a no credit hit mortgage application, you can see an estimate that includes title costs before you give up anything on your credit report.
In Virginia you can also shop for your own title company and settlement agent. Duane Buziak walks clients through that choice and through the “services you can shop for” section of the Loan Estimate, which the CFPB’s Loan Estimate explainer describes line by line. If you pick a provider off the list your broker gives you, ask whether the fees are comparable to ones you could find elsewhere.
Credentials, briefly: more than 1,400 five-star reviews. Scotsman Guide Top Originator in 2025 and 2026. UWM PRO ELITE 2025. Virginia Broker of the Year in 2024 and 2025. To see your title and settlement estimate through NoTouch Credit Pull, call (804) 212-8663.
Short Pump and Henrico Title Insurance FAQ
Is title insurance required on a Short Pump mortgage?
Yes, a lender’s title insurance policy is required on nearly every Short Pump mortgage, because the loan investor or agency requires an insured first-lien position. The owner’s policy is optional.
Who pays for title insurance in Virginia?
In Virginia the buyer customarily pays for the lender’s policy and usually the owner’s policy too, but the purchase contract can assign these costs differently, including to the seller.
Can I skip the owner’s policy on a Henrico home?
Yes, you can skip it, but then your equity is unprotected against defects the title search missed. Simultaneous issue with the lender’s policy typically makes it the most affordable time to buy one.
How much is title insurance on a $520,000 home in Short Pump?
The premium depends on the underwriter’s filed rates and your loan amount, and as of 2026 an illustrative estimate for the owner’s and lender’s policies together is in the low thousands of dollars. Your Loan Estimate shows the exact figure.
Can I choose my own title company in Henrico County?
Yes, you can generally choose your own title company and settlement agent in Virginia, including for homes near West Broad Village or Green Gate, and the Loan Estimate shows which services you can shop for.
Does an FHA or VA loan require title insurance?
Yes, both require title evidence and a first-lien position, and in practice that means a lender’s title policy. VA rules also limit which closing charges a veteran may pay.
What does title insurance not cover?
It does not cover problems that arise after you buy, such as new liens you create, nor does it cover matters excluded in the policy, such as certain zoning or building-code issues. Read the policy’s exceptions and exclusions with your settlement agent.
Does a soft pull pre-approval show title costs?
Yes, a soft pull pre-approval through NoTouch Credit Pull can include an estimate of title and settlement costs, but the binding figures come on your Loan Estimate once you apply.
The Lender’s Policy Is Mandatory; the Owner’s Policy Is the One to Think About
The lender’s policy comes with the loan, and you cannot close a financed Short Pump purchase without it. The owner’s policy is optional, but it is the only title coverage that protects the equity you are building, and it is cheapest when bought alongside the lender’s policy at closing. Ask your settlement agent to quote both before you decide.
Ready to find the right mortgage solution for your Short Pump area home? Connect with our local mortgage experts today for personalized guidance and access to multiple lenders who compete for your best rate. To start with a NoTouch Credit Pull pre-approval from Duane Buziak at Short Pump Mortgage by Duane Buziak, call (804) 212-8663.