Tuesday December 18, 2018

Can I use a Power of Attorney?

Authored by: Lauren M. Randall Posted in: Real Estate

If you’re helping an elderly, disabled or unavailable friend or family member with a real estate transaction, you may be wondering when a Power of Attorney will be accepted.

Before you can officially do anything, an original Power of Attorney will need to be executed by the party unable to complete the transaction personally and if it is going to be used for the execution of a mortgage or deed, the original will need to be recorded in the provincial Land Registry.  Each province has different rules for the execution and recording of Power of Attorney’s, so it is important to check the province where the Power of Attorney is going to be used, not necessarily the province of residence, to ensure that the Power of Attorney you have can be recorded.

Purchase

An agreement of purchase and sale, and other supporting documentation can be signed by a Power of Attorney.  If there is a mortgage you will need the bank’s permission to use a Power of Attorney to execute the mortgage documents.  Often, banks will NOT allow a Power of Attorney to execute mortgage documents, except in exceptional circumstances.  If the borrower has the capacity to sign, the bank would prefer that document be signed by the borrower personally.

Refinance

Similar to a purchase transaction, the bank will often NOT allow a Power of Attorney to execute mortgage documents.  The bank would prefer that documents be signed by the borrower personally, if possible.

Sale

An agreement of purchase and sale, and other supporting documentation can be signed by Power of Attorney.  It is also perfectly acceptable to have the deed and other closing documentation signed by Power of Attorney.  There is no separate authority who will need to provide permission for this to occur.

If you are ever in a situation where you have authority under a Power of Attorney to deal with real estate, you should check with both the bank and the lawyer in the province where the property is located to see if the Power of Attorney is going to be acceptable.

For more information on when a Power of Attorney is acceptable in real estate transitions, please contact one of our skilled real estate lawyers.

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