A power of attorney (POA) allows one party to sign closing documents on behalf of another. In mortgage transactions, POA use is permitted under defined circumstances but is subject to strict requirements from agencies, lenders, and title companies. Attempting a POA closing without confirming all requirements in advance is a common source of last-minute closing failures.
When POA Is Generally Permitted
- ✦Active duty military borrowers deployed overseas or otherwise unable to be present at closing
- ✦Borrowers who are physically incapacitated and cannot attend closing
- ✦Borrowers who are out of the country at closing with a documented reason
- ✦Some elderly borrowers with documented mobility limitations, subject to lender approval
Agency Requirements for POA at Closing
Fannie Mae (B8-5-05) requires the POA to be recorded in the same jurisdiction as the property, executed by an individual attorney-in-fact (not a company), and specific to the transaction (or a general durable POA meeting defined requirements). The borrower must have signed the original loan application personally, or the POA must specifically authorize execution of the mortgage application.
Title and Lender Confirmation Steps
The title company must review the POA before closing to confirm it is valid, properly notarized, and sufficient to convey the required authority. ALTA title insurance requires this review before insuring. Many lenders have their own POA review checklists and require approval from their legal or compliance team before the closing date is set. Do not proceed with a POA closing without lender sign-off and title company pre-review. Confirm both at least 10 business days before the scheduled closing date.
Aria can outline Fannie Mae and FHA POA requirements, explain what makes a POA valid for mortgage use, and walk through the pre-closing confirmation steps. Ask at vicariointel.com.
7-day free trial. No credit card required.
Ask Aria About Power of Attorney Mortgage Requirements →