Power of Attorney For Property: Everything You Need To Know

What is a POA?

A Power of Attorney (POA) is a legal document that provides a trusted friend or family member the right to act on your behalf. So, when you cannot perform certain actions, you can delegate this power to another person through a POA. For example, in the case of property dealings, you may not be able to be physically present for the purchase or sale of a property. Also, you may not be able to physically maintain or lease out your own real estate. In all these cases, you can provide a trusted person with your POA and give this person the authority to act on your behalf.

Why is POA granted?

Many situations, particularly those involving financial decision-making, may require your physical presence. For example, if there is a property that is owned by you that is up for sale, your presence is essential for signing the sale deed and registration. In cases when you may not be able to be physically present, you can delegate this power to another person. If you are abroad and unable to travel, ailing and getting treatment, or for any other valid reason, you cannot make some decisions. The person with your POA can act on your behalf. There are many types of POA, and a General Power of Attorney is the most common.

POA for property dealings

A POA for property dealings can be specific, i.e., it can give the person who holds the POA the authority to sell your property if certain conditions are met. It can also be a general POA that allows the person to deal with the property as they deem fit. In these cases, the agent can sell, mortgage, rent, and manage the property as they deem fit. In some cases, real estate developers prefer to develop an area after having obtained a POA instead of buying it through an outright sale. However, this is not a preferred practice because it makes the land owner responsible for the development and sale of flats through the agent. After consulting a legal or financial expert, it is a good idea to offer POA only to someone you trust.

Things to include in a POA for property

Property dealings often involve high financial stakes. This makes it important for any Power of Attorney granted for property dealings to be very clear and detailed. It should contain the following details -

1.  Complete the grantor's details, including name, age, address, and occupation.
2. Complete details of the person receiving the POA, often referred to as the attorney or power agent, including name, age, address, and occupation.
3.  Reason for granting POA
4.  Time for which POA is granted
5.  Powers granted through the POA
6.  Date and place of the POA and signature of the grantor
7.  Signatures of the witnesses

Things to look out for

It is important to remember that a Power of Attorney is a legally binding and enforceable document, and you (the grantor) shall be responsible for any actions taken by the power agent as empowered by the POA. This makes it important to clearly understand the purpose and need for a POA. Here are some points that you must look out for –

• Competency of the grantor: The POA grantor must be of sound mind and understand the terms at the time of delegation of powers to the attorney or power agent.
• The legality of the POA: The POA must contain all the details mentioned above and be duly signed and registered, and the stamp duty must be paid for it to be legally enforceable.
• Competency of the agent or attorney: The person receiving the POA must be an adult and of sound mind and values. The person should be physically and mentally capable of executing the actions in the best interest of the grantor.
• The legality of the actions: The agent or attorney should check that the property being dealt with legally belongs to the grantor, i.e., the title holds the grantor’s name and has a No Encumbrance Certificate.
• Description of asset: In case of property dealings, it is important to check the extent, location, and other details of the asset in the General Power of Attorney (GPA) and match them with land records, title deed etc.

Getting legal help

A POA, particularly when granted for property dealings, should be specific and protect the grantor's interests. There are several draft POAs available on the internet, but when it comes to making major decisions, it is a good idea to consult a lawyer who specialises in real estate law. They are well-versed in the various legislations dealing with property purchase, sale, inheritance, and other aspects of real estate law. Getting legal help is important to keep you protected from loss or legal fallouts. If surreptitious individuals misuse a POA, it is important to seek legal recourse to sort out the issue.