What should a new licensee expect regarding the legality of a client holding closing money with a settlement agent?

A client has the legal right to designate a settlement agent to hold closing money during a real estate transaction. This practice is common and allows clients to have a trusted individual or entity handle the funds necessary for closing. By designating a settlement agent, the client can ensure that the closing money is managed appropriately and in accordance with the terms of the transaction.

In Virginia, settlement agents can include both licensed real estate professionals and attorneys who have the necessary qualifications. This flexibility provides clients with options for handling their closing funds in a way that fits their needs, making the legal designation of a settlement agent a common and accepted industry practice.

Recognizing this legal aspect is crucial for new licensees, as it helps them properly guide their clients in effective transaction processes and comply with relevant regulations.