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Power
of Attorney Checklist
Date_____________
Branch Number________ From__________________________________
__ Ext._____________
Borrower____________________________________________________
Loan Number_________________________
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Definitions:
·
POA
refers
to the Power of Attorney document.
·
Principal
is
the person who signs the power of attorney, authorizing the
Attorney-in-Fact (or Agent) to execute the loan documents on his or her
behalf.
·
Attorney-in-Fact
(or Agent) is
the person who will sign the loan documents on behalf of the Principal.
·
Durability
Clause contains
the words "This power of attorney is not affected by subsequent
disability or incapacity of the principal," or similar words showing
the principal's intent that the authority given to the Attorney-in-Fact
(or Agent) may be exercised even if the Principal becomes disabled or
incapacitated.
·
General
POA
gives the Attorney-in-Fact (or Agent) broad powers.
·
Specific
POA
contains information on a particular loan transaction (e.g., at a minimum,
the property address and legal description).
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Loan Type:
q FHA
q
Conventional q
VA*
Loan Purpose: q
Purchase q
Refinance
Power
of Attorney Type: q General
q Specific
q Durable
*A
Power of Attorney used in a VA loan transaction for the veteran-borrower must
contain language specifically granting the Attorney-in-Fact (Agent) authority
to use the Principal’s VA eligibility (i.e., "authority to utilize my
eligibility for VA Guaranty"). If
the POA does not contain this language, the branch must obtain a written
statement from the Principal that specifically gives the Attorney-in-Fact
(Agent) the authority to utilize the Principal’s eligibility for VA
Guaranty.”
Word of Caution:
Remember
that a POA means the Principal will not actually sign the loan documents.
There is a risk that the Principal may not know of the loan
transaction or that the Principal is a fictitious person.
If you suspect any wrongdoing, investigate the circumstances to
ensure everything is in order. If
you discover anything questionable, contact the Legal Department.
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1. Is this a Specific POA? If no, the POA is unacceptable for FHA loans, and any
cash-out, home equity or purchase money loan. CHL prefers a Specific POA on all
loans to ensure the Principal is aware of how the Attorney-in-Fact (or Agent) is
exercising his or her authority. However,
for Conventional and VA rate/term refinances, a General POA may be used if the
investor will accept a General POA.
q Yes q No
2. Is the POA executed by the Principal? If no, the POA is
unacceptable.
q Yes q No
3. Is the POA dated? If
no, the POA is unacceptable.
q Yes q No
4. Is the Notary Public Acknowledgement complete and the
Notary's commission current? If no, the POA is unacceptable.
q Yes q No
5. Was the notary completed in a foreign country?
If yes, the document must have been acknowledged before a consular
officer of the
United States
, a notary public, or a commissioner or other
agent with authority to take acknowledgements.
Alternatively, the document may be acknowledged by an ambassador,
minister, envoy, or charge’ d’affaires of the
United States
, in the country to which s/he is accredited.
Otherwise the POA is unacceptable.
q Yes q No
6.
Is this a Military POA? If yes, the document must have been acknowledged
before either a notary public or an officer in the office of the Judge Advocate
General. The acknowledging
officer’s name and rank must be printed legibly beneath his/her signature.
Otherwise the POA is unacceptable.
q Yes q No
7. Does the POA include language that entitles the
Attorney-in-Fact (or Agent) to execute, sign, and deliver a mortgage, deed of
trust for real property and “hypothecate” (or pledge) property?
If no, the POA is unacceptable.
q Yes q No
8. Has the POA been recorded? If no, it must be recorded.
9. Has a revocation of the POA been recorded? If yes, the
POA is unacceptable.
q Yes q No
10.
Is the Principal a veteran? If
yes, the spelling of the name must match the VA Guaranty, the
POA must have the required VA Guaranty verbiage, and you must have the Alive and
Well Statement. If the POA does not
have the required VA Guaranty verbiage, you must have a statement from the
Principal giving the Attorney-in-Fact (or Agent) the authority to use the VA
Guaranty.
q Yes q No
11.
Does the POA have a Durability Clause?
If
no, request a physician’s letter dated the same day as closing confirming that
the Principal has not become physically or mentally disabled or incapacitated.
(If there is no durability clause and the Principal becomes disabled or
incapacitated prior to closing, this will terminate the POA and make the
signatures invalid.).
q Yes q No
12.
If
there is no Durability Clause, do you have knowledge of the Principal becoming
physically or mentally disabled or incapacitated after signing the POA?
If yes, the POA is unacceptable.
q Yes q No
13.
Do you have knowledge of the Principal’s death?
If yes, the POA is unacceptable. POAs
terminate upon the death of the Principal.
q Yes q No
14.
Will the closing agent or attorney be instructed on how the
Attorney-in-Fact (or Agent) must sign the loan documents?
The Borrower’s name must be printed below the signature line. The
signature must read, “Joe Smith by Kathy
Smith, his attorney-in-fact.”
Yes No
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