It’s time for your closing, and you can’t be at the settlement table. Now what? There are options to keep the process moving forward, and a Power of Attorney (POA) may be just what you need. When a buyer or seller can’t attend the closing, using a Power of Attorney can be a possible solution. With proper planning and preparation, the team at Highland Title + Escrow can help!
What is a Power of Attorney? Essentially, it’s a legal document that gives another person permission to act on your behalf concerning legal matters (a real estate title transaction in this case) if you are absent at closing. You are considered the principal, and the person acting on your behalf is referred to as the attorney-in-fact or authorized agent.
It is well known that real estate transactions involve plenty of paperwork and signatures. If you are selling an investment property in Virginia but live in Florida, a POA might be the choice for you. Health issues, travel, and military assignments, as well as other circumstances, are reasons you might consider using this option.
There are also different types of Power of Attorney to consider depending on your state of affairs.
- Special Power of Attorney: Also known as a limited or specific power of attorney, these are prepared are typically prepared if a buyer or seller cannot attend settlement. These powers of attorney allow an agent to complete a specific transaction, such as the sale or purchase of a house, and are typically good for a limited power of time.
- General Power of Attorney: This option allows your agent to do almost anything for you. These powers of attorney are typically prepared by estate planning lawyers together with wills, trusts and directives. Although they permit an agent to complete real estate transactions, they are usually used when the principal is incapacitated.
Choosing your agent or becoming an agent for someone else can be a tremendous responsibility. Choose mindfully; trust is key. While a POA can be as specific or broad as you like, it is important to set limits to your agent’s permissions so each party understands exactly what is expected of them. An agent can be used in selling, buying, refinancing and purchasing, so determining what action needs to be taken is key. You can also consider more than one agent, a co-agent or successor, if you think your initial choice may be unavailable.
So, you’ve decided on the type of POA, and you have also chosen your agent. What’s next?
- Be proactive, obtain approval. If you anticipate the need for a POA, the time to act is now. Every POA must be approved in advance by the title company and the mortgage lender, if applicable. The settlement agent can typically assist with the preparation of a POA.
- Seek advice from an attorney. It’s important to fully understand the implications of using a POA. Forms, language and signatures can be very specific from state to state. You can always contact Highland Title + Escrow’s team to guide you in the right direction. Our team works with lawyers that are experts with these matters.
- Originals matter. The original, signed and notarized power of attorney must be given to the settlement agent prior to settlement. However, powers of attorney may be signed with remote online notary publics (“RON”). Highland Title + Escrow can help you with this as well.
If we lived in a perfect world, being in multiple places at once would be possible! However, when that isn’t possible, a proper Power of Attorney can keep your real estate purchase or sale moving right along. As your transaction moves along if we think a POA may be needed, we’ll certainly be there to guide you through the process. Please contact us at 703-723-3300, or send us a message if you have any questions.