Federal Title & Pavaso Partner to bring online closings to the DMV

For Immediate Release

Media Contact: Nikki Lyon

Main Line: 202.362.1500

Federal Title & Escrow Company Partners with eClosing Provider Pavaso to serve Washington, D.C., Maryland, and Northern Virginia Settlements

Washington, D.C., December 22, 2017 – Federal Title and Escrow Company has partnered with eClosing service provider Pavaso to bring cutting-edge technology to real estate settlements in the Washington D.C., Maryland, and Virginia area. Pavaso created the industry’s only end-to-end digital closing platform to improve communication, efficiency, and process management in the real estate settlement arena and is continuing to focus on the improvement of the consumer experience.

Federal Title and Escrow Company’s main initiative is to be at the forefront of innovation to make the closing process simpler and smarter for the consumer. We are constantly striving to utilize technology to streamline the closing process without sacrificing the personal relationship we build with our clients. The real estate settlement market has been rapidly moving toward online closings. Pavaso provides us with a secure platform to link all parties in the transaction so that we may conduct both hybrid and fully online closings.

Pavaso’s technology empowers lenders and title companies to deliver the speed and ease of a modern transaction without neglecting the human touch. As today’s consumers increasingly demand the simplicity and convenience of an online transaction, Pavaso is bridging the gap between the archaic paper mortgage process and the digital world. Its technology is both flexible and “future-proof,” enabling users to conduct digital transactions ranging from hybrid closings to complete eNotes.

“The D.C. metropolitan area consists of millions of hardworking individuals that may not have the time for the traditional settlement,” said Todd Ewing, CEO, Federal Title and Escrow Company. “Pavaso allows the consumer to review documents, sign, and securely complete closing from their own preferred venue.”

“We pledge to provide the best experience for the consumer and seek to refine and continually improve the end to end borrower experience,” added Mark McElroy, CEO, Pavaso. “Each and every day closings are happening across the country with consumers who don't fully understand the process and there is less room today for a cumbersome, inconvenient experience. Consumers have choices now and want a better experience. By moving to a digital closing process, Federal Title is providing that experience, allowing borrowers to benefit from a significantly more informed, transparent and convenient process.” 


About Federal Title & Escrow Company

Established in 1996, Federal Title & Escrow Company, the largest independently owned and operated title company in Washington, D.C., is known for its top-notch customer service and streamlined closing process. Federal Title has D.C. office locations in Friendship Heights and in Logan Circle. For more information, please visit www.federaltitle.com or contact Nikki Lyon directly for media inquiries.

About Pavaso

Texas-based Pavaso is transforming the mortgage process with radically innovative digital mortgage closing technology facilitating fast, consistent, accurate and compliant closings every time. Pavaso offers a single, collaborative, secure portal promoting transparency, efficiency, consumer education and communication in a seamless format delivering value to every stakeholder involved in the transaction. For more information on how you can streamline your process and digitally transform your organization, call us at 866.288.7051 or visit www.pavaso.com. 

DC Real Property Assessment Cap Credit

Understanding the property tax assessment process can be a bit tricky. Specifically, it can be difficult to understand the difference between an assessed value and a taxable assessed value. Part of the confusion has to do with the Assessment Cap Credit. Here is an example of a recent question on this topic: 

Question: On my DC Tax bill, the assessed value is listed as $388,500, but my taxable assessment was only $291,200, a difference of $97,300. What accounts for this difference?

Answer:  The bulk of the difference has to do with the Homestead Deduction, which reduces the real property taxable assessment by $72,450.  However, there is a second benefit to the Homestead Deduction that receives a lot less attention, the Assessment Cap Credit.  This credit provides that the taxable assessment cannot increase more than 10% per year.  The credit is not applied against the assessed value, but it is used to reduce the taxable assessed value.  In the above question, the additional credit that reduces the taxable assessment by a further $24,850 is the assessed cap credit.  Further, based on the above numbers, next year’s taxable assessment cannot exceed $320,320 ($291,200 plus 10%), regardless of the assessed value (assuming of course that the property is still registered as a homestead).

The District of Columbia Office of Tax and Revenue has great information on their website that explains in detail the real property process and the credits available.

How to qualify for the DC Tax Abatement program

DC Tax Abatement

The DC Tax Abatement program is designed by the District of Columbia to help lower-income homeowners. Below are some often asked questions from agents and potential homebuyers. 

What does the DC Tax Abatement program entitle me to do?

Assuming you qualify, you are exempt from paying transfer and recordation taxes. This means not only are you exempt from the recordation tax; but customarily, the seller’s transfer tax is credited to you at settlement.  You will also be exempt from paying real property taxes for 5 years beginning the next full tax year after filing.  

What are the qualifying factors to get DC Tax Abatement?

The qualifying factors for DC Tax Abatement are as follows:

  • The purchase price of the property must be $456,000.00 or less;
  • The income threshold – max gross income – must be  











  • The property must be a principal residence; and
  • The purchaser must be domiciled in the District of Columbia.

 What does “domiciled” in the District of Columbia mean?

 To be domiciled in the District of Columbia you must (a) get a DC government issued ID such as a DC Driver’s license; (b) register to vote in DC; and (c) file DC Personal Income taxes.  Please note: the purchaser can obtain/do the above mentioned after the purchase.

What documents are required to get the Tax Abatement?

The documents usually required are:

  • Last 2 years income taxes;
  • Last 2 W-2s;
  • Last 2 paystubs.

If there are any extenuating circumstances i.e gaps in your employment, self-employment, etc., the District of Columbia may require additional documentation from you before approving the abatement application.

Who files the documents so I can get tax abatement?

The settlement agent files the required documents along with the settlement statement and sales contract when recording the deed after closing.

I am in the military, does my housing allowance count as income despite it being non-taxable income?  Do I need to change my State of Legal Residence?

Yes. The DC Recorder of Deeds looks at all sources of income, not just taxable income. 

Yes, you need to be domiciled in the District of Columbia which includes filing DC income taxes. You can fill out and file a form DD2058 to change your residency to the District of Columbia.

How do I know that my tax abatement application was approved?

The settlement company handling your closing will know immediately because your deed will go on record without transfer and recordation taxes. You will also receive a letter from the District of Columbia confirming that you qualified for the tax abatement and giving the years you will be exempt from property tax.

If I qualify for tax abatement, why is my lender still collecting taxes in escrow? 

The real property tax exemption does not start until the next full tax year.  In other words, if you settle in April 2018 and the tax period for 2018 is October 1, 2017, through September 30, 2018, you will not be given the exemption until the 2019 tax period. You will be required to pay real property taxes for April through September 2018. Your real property tax exemption will start 2019 and finish 2024.

 What happens if my situation changes – am I required to report it to the District?

The answer is Yes. If your household income increases or you decide to rent the property rather than using it as your principal residence, you must report it to the District. Until recently, nothing was specifically stated in the application.  The updated application now specifically states “If the household ceases to qualify for the Lower Income Homeownership Exemption, it is the responsibility of the owner to provide written notification to OTR’s Special Programs Unit within 30 days of the change in eligibility. Email specprog@dc.gov. This means individuals must keep up with the annual thresholds for the tax abatement program and self-report any changes. This also means individuals must notify the same unit if they are no longer living in the property as their principal residence. 

 If your questions about tax abatement have not been answered here, please feel free to contact me 202.362.1500 ext 1514. 

CLOSE IT! House of the week: A family-friendly Cleveland Park Home

We close out 2017 with our house of the week located in Cleveland Park.This large home welcomes you with a charming front porch that opens to over 2,000 square feet of space to include four bedrooms and three bathrooms. The home is fully equipped with stainless steel appliances and granite countertops in the kitchen, plus a full-sized washer and dryer. Even though the pad is virtually walking distance to shops and dining in the area, it also has a garage and driveway for commuters or guests to park comfortably. This is super important as you are likely to have family or friends over this summer to barbeque in your fenced-in backyard. The property is listed at $1,200,000 and is looking for new owners.

Assuming a homebuyer puts down 20 percent, their cash-to-close would be $274,427 and monthly mortgage payments would be approximately $3,575. You’ll also receive a credit of $750 when you choose to use Federal Title & Escrow Company for settlement services when ordered online. For a complete picture of what your cash-to-close figures would be, including seller’s net proceeds from the sale and such, please view the Close It! Web version or download the free Close It! iOS app.

Condominium By-Laws: Why are they so important?

If you are considering purchasing a condo, it is important that you read through all the condominium documents that have been provided by the seller for your review. You will be provided with what appears to be an overwhelming amount of paperwork, but reading through the information will assist you in making an immediate decision as to whether this is the right condo for you and it may also assist you down the road should any issues arise that impact you as the owner. 

The condominium package that you receive, often called the “resale package”, will contain an entire set of condominium governing docs that include the Declaration, By-laws, copies of financial records of the condo, plat and plans, and rules and regulations. The By-laws are perhaps the most important part of any condominium association documents. The By-laws are a contract between the condo association and the owners. The condo unit must be used only in accordance with the Bylaws of the association. They contain certain information such as the duties and authority of the Board, what parts of the condo you own, whether leasing is permitted, what responsibilities unit owners have, what kinds and sizes of pets are permitted, age restrictions, procedures for any special assessment and whether or not a special assessment requires the vote of the members (owners), procedures for setting and raising assessment amounts and whether there is a limit on annual assessment increases, insurance requirements, and the list goes on and on.

Taking the time to read through and familiarizing yourself with the terms of condominium documents will put you in a much better position to determine if the condo is the right one for you. 

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