Can I use a power of attorney to sign closing documents for my spouse/friend/parent?
We always prefer to have closing documents (any document for that matter) signed by the proper party, however, there are often circumstances when it may not be convenient or even possible. Listed below, in order of preference, are the most common situations and conditions for which a power of attorney may be used.
Whether buying or selling, we (the attorneys at CloseTrak) prefer to draft a limited power of attorney to be used specifically for the real estate closing. If it is a seller and the seller is available, we prefer to have the seller sign the warranty deed and we will also have a power of attorney executed to sign the rest of the closing documents. When possible, we always prefer to have the seller sign the actual warranty deed which conveys the title to the property to the buyer. When we record the deed we will also need the original power of attorney to record. The “original” document is the one actually signed and notarized.
If the power of attorney is used for a buyer and the buyer is obtaining a loan to purchase the property, we will need to furnish a copy of the power of attorney to the mortgage company for review and approval. Again, we will need the original power of attorney for recording.
Oftentimes, clients already have a power of attorney that they wish to use. In those instances, we will need to review the power of attorney in advance to ensure that it permits the real estate transaction and also obtain approvals from others (title company, mortgage company) if needed. Again, we would need the original for recording.
How much will it cost to sell my home? Or buy a home?
The answer is a definite – it depends. It depends on what you negotiate in the sales contract, what kind of financing the buyer obtains and where you are and the local customs. In Shelby, Tipton and Fayette counties, where a realtor is involved, closing costs are typically divided such that the seller pays for the title search, the seller’s closing attorney’s fees and the real estate commission for both agents. For more details on the closing costs for selling a house in Memphis, Tennessee, we created this short video:
Also, we’ve created a spreadsheet for you to calculate your closing costs – Seller Net Sheet.xls and here is an example of a closing statement for a seller. HUD Seller Example. This closing statement is the same format that you will see at closing. The seller’s portion of the statement begins at line 401 on page 1, and at line 703 in the far right column on page 2. We also have a few podcast episodes on seller’s closing costs and another on buyer’s closing costs.
If you enjoy podcasts, we have more real estate related episodes and also several episodes pertaining to other areas of the law – the show is called Lawyer Straight Talk.