If someone were to grant you power of attorney in regard to their finances, belongings and property, is that enough to allow you to conduct real estate transactions on their behalf? Actually, it’s a question that we hear quite often.
In such cases, the person who gives power to another individual is call a “principal.” And, the principal can assign various levels of power of attorney to his or her “agent,” thus allowing the agent to legally act on the principal’s behalf.
According to LegalZoom.com, power of attorney can be classified as limited or general. Limited power of attorney will allow an individual appointed by the principal to conduct specific transactions, such as the sale of a home. General power of attorney grants the agent much broader authority, allowing him or her to do anything the principal can do.
Additionally, powers of attorney can be classified as durable or nondurable. In simple terms, a durable power of attorney remains in effect should the principal become incapacitated due to failing health, while a nondurable power of attorney is terminated when and if the principal becomes incapacitated.
No matter what label the power of attorney carries, the agent must always act in the best interest of the principal. For example, the agent cannot legally sell property to himself for far under market value if that’s not in the principal’s best interests.
Like all legal matters, it is best to seek the advice of an attorney and/or a trusted Realtor, especially in situations that involve the sale of property.