Special powers of attorney for financial management carry the same caveat as general powers of attorney: placed into the wrong hands, they can become a license to steal. Like all financial powers of attorney, you must be certain that the person you appoint to act as your agent is absolutely trustworthy. Here are some examples of special powers of attorney and how they work.

A special power limits your agent’s authority and is generally used only in specific circumstances. For example, you may be in the process of purchasing a home but, nearly a year ago, you purchased a non-refundable European vacation and you won’t be available to sign all of the real estate documents. A special power of attorney can authorize your agent to act on your behalf and sign all necessary papers to complete the purchase.

Under this scenario, your agent’s authority is very limited.

Contrast this to a general power of attorney for financial matters. With this document, you are granting authority for someone else to handle all of your financial matters – opening and closing bank accounts, withdrawing money, purchasing or selling real property – essentially, your agent would have the ability to transact every type of financial business that you would. A very dangerous document if placed into the wrong hands.

Usually, a general power over finances should only be granted if it utilizes a “springing power”. This means that your agent has no authority to act unless two qualified medical doctors provide written declarations, under penalty of perjury, that you are incapacitated and unable to make sound financial decisions. Then, and only then, does the power “spring into being”, as it were, and allow your agent to act on your behalf.

A special power of attorney generally becomes effective immediately. It is granted to allow your agent the authority to handle one or more specific transactions and, again, is usually done out of convenience because you are unavailable to timely act.

Using a boilerplate form where you just fill-in the blanks to specify the exact authority you wish to grant can be a mistake. Sometimes the authority is too limited and could prevent your agent from being able to complete the particular financial transaction. For example, granting authority to “sign all documents required by my real estate broker” may not be acceptable to the lender or the escrow company. They may have different requirements and do not feel comfortable in recognizing your agent’s authority under the special powers you have stated.

An attorney can assist with the creation of a special power of attorney for financial matters and, in doing so, should contact all of the companies and agencies involved to ensure that their requirements are met. The exact language used in the document can then be tailored to meet all of these needs.

Special powers of attorney can be very useful in completing certain transactions but should be tailored to meet very narrow and specific situations. If properly drafted, they are a valuable financial tool.

By: George Dickerman

If you are planning your life and want everything thing to be in right just in case, then Power of Attorney is something you should pay special attention to.

Power of Attorney is valid in all states across the US and it gives one or more persons the right or power to act on your behalf. The power or right to act on your behalf can be limited to one particular activity or it can empower a person to act on your behalf in a variety of situations.

A Power of Attorney can either come into immediate effect or it can be exercised on occurrence of an event in future. The right to act on your behalf can be temporary, continuous or permanent.

Should you want to revoke the Power of Attorney given to a person, it can be done so. However, most states in the US require a written notice of revocation.

Most people wonder why is it necessary to give another person power to act on their behalf. The answer is actually very simple. It is all about convenience. If you are buying or selling assets, you may not want to be present always to close the deal. Power of Attorney allows another person or persons to close the deal on your behalf. However, the most important use of Power of Attorney comes with you are incapable of acting on your own behalf. This could be due to an accident, illness or you might be traveling. It allows another person to act on you behalf so that nothing is stalled and things can function.

In case you are unable to manage your personal or business affairs, and do not have a Power of Attorney, then the court may appoint a person to act for you. You will not have a say as to who should be appointed. However, with a Power of Attorney, the right to choose a person and the limits of the authority they have is up to you.

If you do not have a Power of Attorney, it is about time you started thinking about one. It will remain valid once you sign it and it will stay valid until you die or revoke it.

By: Pauline Go

“Power of attorney” is a legal tool that allows another individual the authority to act as a person’s legal representative. This gives that person the power to make binding legal and financial decisions on a person’s behalf.

It is not exceptionally difficult to find forms to grant someone the power of attorney via the internet, but there is typically not a lot of explanation of what a power of attorney is. In addition, there is very little information concerning when a person needs a person to act as power of attorney or even what type of power of attorney to choose. These are very difficult decisions to make as giving the power of attorney to someone gives that person considerable power over your life. Because an individual with power of attorney has the ability to sign a different person’s name to legal contracts, careful consideration should be given to choosing a person and whether or not limits should be placed on how long the power of attorney will last and what limits should be imposed on a person’s powers.

There are, broadly, two basic types of powers of attorney. A “general” power is unlimited in both its scope and in its duration. This granted type of power permits the named individual to act as a person’s legal representative in relation to all financial matters until the power is revoked.

A “specific” power creates limits on a person’s named representative. It is possible for a “specific” power to bind a representative’s powers to one single type of conduct or even a single transaction. As an example, the representative could be granted the power to engage in financial transactions stemming from a specific checking account or be given the power to sign the closing documents for a specific real estate transaction. These activities are very limited and are assigned to a specific type of transaction. They are not nearly as broad as “general” powers are.

Either type of power can be limited in its duration. This means that the person selecting a representative can specify a date after which the power of attorney assigned to that representative will no longer be valid.

Typically, forms granting power of attorney do not have to be registered with the state. If a form grants an individual the rights to engage in transactions and dealings pertaining to real estate, it may be required that the forms be registered with the state.

If you would like more information concerning power of attorney or other legal transaction related to probate, please visit http://www.probatelawyeraustin.com.

By: Joseph Devine