Virginia Law

The incidental expenses payment is the amount necessary to reimburse the homeowner for the reasonable costs actually incurred incidental to the purchase of the replacement dwelling, but not for prepaid expenses such as prepaid real estate taxes, fire insurance, etc. Such costs include the following items if normally paid by the buyer:

1. Legal, closing and related costs, including those for title search and mortgage insurance, preparing conveyance instruments, notary fees, preparing surveys and plats and recording fees;

2. Lender, Federal Housing Administration (FHA) or Veterans Administration (VA) appraisal fees;

3. FHA or VA application fee;

4. Professional home inspection or certification of structural soundness when required by the lender;

5. Credit report;

6. Owner's and mortgagee's evidence of title, e.g., title insurance, (not to exceed the cost for the comparable replacement dwelling);

7. Escrow agent's fee;

8. State and local revenue or documentary stamps, sales or transfer taxes charged to record deed (not to exceed the costs for a comparable replacement dwelling);

9. Loan origination or assumption fees that do not represent prepaid interest;

10. Purchaser's points, but not seller's points, normal to similar real estate transactions; and

11. Such other costs as VDOT determines to be incidental to the purchase.

No fee, cost, charge or expense is reimbursable as an incidental expense when it is determined to be part of the debt service or finance charge under the Truth in Lending Act. Except when the replacement housing amount is paid into escrow, the combined total of the payments under this section will be claimed and paid in a lump sum.