Power of Attorney
Definition and meaning of Power of Attorney in real estate.
A power of attorney is a legal document that grants one individual the authority to act on behalf of another person in legal, financial, or property matters.
In more detail
In real estate transactions, a power of attorney is often used when a buyer or seller cannot attend the closing in person, such as due to military deployment, travel, or medical issues. The person who grants the authority is the principal, and the person who receives the authority is the agent or attorney-in-fact.
The document must be drafted carefully, and it usually needs to be notarized and recorded in local land records to be valid for real estate deals. Lenders and title companies have strict guidelines for accepting a power of attorney, often requiring it to be approved well before the closing date.
Key facts
| Category | Legal, Titles & Closing |
|---|---|
| Also known as | POA |
| Required by | Lenders, title companies, and closing agents |
| Duration | Ends upon revocation, the principal's death, or a specified expiration date |
A home buyer who is traveling overseas during their scheduled closing signs a specific power of attorney that allows their spouse to sign the mortgage documents on their behalf.
Frequently asked questions
Can you use a general power of attorney for a real estate closing?
While a general power of attorney is sometimes accepted, most title companies and lenders prefer or require a specific power of attorney that describes the exact property and transaction.
Does a power of attorney remain valid after the principal dies?
No, all powers of attorney automatically expire immediately upon the death of the principal, and the authority then shifts to the executor of the estate.
Related terms
Sources & references
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