Durable POA & Real Estate – Everything You Need to Know

This content has been fact checked by Lisa Rogers, Principal Attorney + Partner at ARK Attorneys.  An ATG Title brand.

A Durable Power of Attorney (POA) is a legal document that a competent adult can use to appoint an agent on the principal’s (your own) behalf. A Power of Attorney terminates when either party dies or becomes mentally incompetent.  However, a Durable Power of Attorney contains specific language that allows authority to continue after the principal becomes mentally incompetent.

Durable Power of Attorneys (POA) can be used to keep a real estate transaction moving including when the signer is out of the country for work, unable to physically or mentally sign, or if they are deployed overseas in the military. This is because the person who is supposed to sign the documents and make the decisions has given the legal power to a trusted person known as a Durable POA.  

But it is important to know that the laws for durable power of attorney change state by state and sometimes by city and circumstance.  For example, you may assign someone durable power of attorney in California, but if the property is in a state that doesn’t recognize this, the real estate deal may not carry through.  And there could be an expiration on the durable POA.  But don’t panic, durable POA is very common, especially for real estate transactions. 

The first step is to hire a licensed attorney that specializes in this type of work.  You’ll want to talk to someone in the state where the transactions will be taking place.  And durable power of attorney is important for more than just signing documents when you want to buy a property.

Durable Power of Attorney is a Good Idea:

• If you become incapacitated as you’ll have someone you trust taking care of you.
• When you are traveling overseas and you’ll need someone to be present that can make a decision on your behalf.
• In case a greedy relative or someone who should not be in charge of your estate will try to take control.
• When you’re in the military and are being deployed.
• If you are or the person is elderly, or has a long term illness that will prevent you from making decisions on your own.
• In case you become unable to function on your own and need someone you can trust.
• As a “just in case” measure for when you cannot attend a signing, so that you have a backup and the deal doesn’t fall through.

The process of getting a Durable Power of Attorney is:

1. Hire a lawyer to draft the documents
2. Choose the person who you trust the most and assign them as POA
3. Both you and the person signing will meet with the lawyer and show you have sufficient mental capacity to do this
4. The Principal (or the individual giving power) signs the document
5. It gets notarized and witnessed, then stored in case of the worst happening

Now that you know what durable POA is, when it is a good idea, and how the process works, here’s some frequently asked questions about durable Power of Attorney.

What is durable power of attorney?

Durable Power of Attorney is giving someone you trust the power to make decisions on your behalf in case you cannot make them on your own.  They will be trusted to manage your financials as well as real estate including your home/homes.  They will also control the decisions about your health, care and well-being.

Can it be assigned after the person is incapacitated?

No. Durable power of attorney cannot be assigned after the person is incapacitated or mentally unable to make a clear decision. That means if you end up unable to make decisions on your own, someone you do not trust can take claim to your house, your money, and make decisions about how you’re looked after.

Is it the same in every state?

No, each state has their own separate laws and rules for durable power of attorney.  If you move for work, for love, or any other reason, your new state may not recognize the agreement and it can be overturned.  It is important to talk to a licensed attorney before moving, and to talk to the person you are giving durable power of attorney to about their plans to retire and what it means for you.

Can you sign a deed, mortgage or title on the person’s behalf?

Yes, if the document is recognized by the state, you are the decision maker for the person.  You can sign all real estate documents on their behalf including their titles, deeds and mortgages.

Is the POA able to be used across all real estate documents?

This depends on the title company and the documents.  If the power of attorney document is part of the document, and the title company can clear it, then it may be used on numerous documents.  But this will depend on the states that are involved, the title company to clear it and which documents need to be signed.  Each situation is unique which is why you need to have a licensed attorney at the meeting or to review the deal.

What if the property is in another state?

The title company will need to record it in that county and that states records, not the one where you are and are living.  Finding if the transaction is recorded is normally done during a title search.

Having a Durable Power of Attorney for real estate transactions and for your life is a big responsibility.  It is hard to choose the person you can trust, but it can also be very important.  If you have questions related to real estate transactions you are involved in and durable power of attorney, we have a legal team on hand to help.  Call us at (703) 934-2100 or email us at info@atgtitle.com and we’ll help to answer your questions and close your deal.