A power of attorney for property, also known as a durable power of attorney for property or limited power of attorney for property, is a legal document in which the principal grants limited rights and authority to the agent. The principal may have executed the document prior to a disability or being adjudicated as incapacitated. The three major areas covered in a power of attorney for property are the sale of property, the acquisition of property, and refinancing of mortgages. The agent acting on the principal’s behalf often has the right to convey title of the property. The power of attorney is often witnessed by at least two persons of adult age and sound mind and signed by a notary public.
All types of property are covered by a power of attorney for property, but it’s possible for a principal to limit it to real estate transactions only. For example, a principal who is unable to manage his financial affairs may authorize an agent to oversee his bank accounts. The financial institution would require the power of attorney prior to discussing any information regarding the account or authorizing the agent to make deposits or withdrawals from the bank account. If it’s a limited power of attorney for real estate transactions, then the agent is able to sell or acquire property on behalf of the principal. The principal may limit the power of attorney for property to a single transaction or broaden the scope to as many transactions as needed until the document is revoked, expires, or is otherwise terminated.
A principal may take two precautions to protect her rights when executing a power of attorney for property. To begin with, a termination date is often listed to keep the relation as finite as possible. Another precaution taken by principals is to list successors to the agent in the event the agent refuses to perform his duties or becomes mentally or physically incapable of carrying out his duties.
In some cases, the rights granted extend beyond management of property and real estate transactions. The power of attorney for property is also used to grant an agent the authority to manage financial matters for the principal. Some examples of financial matters include oversight and management of retirement and insurance plans, tax matters, and business management. The agent may also act as the authorized representative in civil lawsuits that pertain to financial and real estate transactions. That often includes the right of the agent to commence a lawsuit and to obtain the services of legal counsel.