A so-called “split settlement” occurs when the escrow, closing, or settlement services for which the Settlement Agent is responsible is shared or divided between two or more individuals.

Split settlements are not authorized in Virginia. Virginia Code clearly authorizes the buyer to select the Settlement Agent that is to provide the mandated services in connection with the transaction. VA Code § 55.1-1006. The seller cannot require the use of any particular Settlement Agent for that transaction. The Virginia Code repeatedly makes reference to “the Settlement Agent,” indicating that there can only be one singular Settlement Agent. See Va Code §§ 55.1-900, 55.1-902, 55.1-907, 55.1-903, 55.1-1000, 55.1-1006, 55.1-1007, 55.1-1008, and 55.1-1011. In February of 2022, the Virginia Bureau of Insurance, which regulates the title insurance companies and title insurance agents, issued a bulletin explaining that if “multiple settlement agents were anticipated or authorized under the Code, there would be no need for the Code to designate the buyer as having the exclusive right to choose the settlement agent for the transaction and to specify that this right cannot be varied or waived.”

Moreover, Section 55.1-1008 of the Virginia Code requires that "[a]ll funds deposited with the settlement agent in connection with escrow, settlement, or closing shall be handled in a fiduciary capacity." The Virginia Bureau of Insurance has also issued guidance indicating that the Settlement Agent’s fiduciary responsibility cannot be assigned or substituted, and that, as such, there can only be one designated Settlement Agent.