Problems You Never Want To See: Out of State Orders (TP Aug 2026)

Presented by Kay M. Creasman | Virginia Counsel & VP of ORNTIC

Periodically, problems arise due to matters that have occurred in other states with an impact in Virginia.

FACTS: For reasons not known to us, a Tennessee court awarded title to real estate in Tennessee to a married couple and a minor child of the wife, who is the child’s mother. The Tennessee real estate was sold for $200,000 and a property in Virginia purchased. $35,000 of the proceeds from the sale was held in escrow with the Tennessee court until the child reaches age 18. The Virginia property in 2021 was ordered to be titled ¾ in the name of the married couple and ¼ in their names as trustees of the minor child until he turns 18. The deed was recorded with that division and with a copy of the Tennessee order attached. The order specifically states that if the property is to be sold the Tennessee court must approve the sale and the division of the proceeds from the sale.

Q: The couple want to get a HELOC. Their attorney asks whether or not they need the approval of the Tennessee court to encumber the property. The order does not address refinancing or an equity line on the property.

A: When we have part of the story, we are often curious as to what’s the rest of the story. Why such a split between the parties? Did the boy inherit an interest from his father and then his mother remarried? We don’t know, and it’s not essential to resolve the issue. But it makes for an interesting situation.

Remember that title insurance is all about risk identification and elimination. In this case, we required a court order from the Tennessee court approving the home equity line as it will place all the property at risk.

Of course, we never hear the rest of the story either. The court could require the couple to purchase the child’s ¼ interest and place those funds with the Tennessee court as well as the funds they already hold. Or the court might just allow the equity line to be secured by the real estate. Or they could deny the request to refinance until the child reaches 18. We have no idea how old the child is or what the court will do, but we do know that we require a judicial determination of the issues involved prior to insuring without an exception for me matter.