COVID-19 continued:

COVID-19 continued:

Attendance at closings – Issue and Solution (during these special circumstances)


This message follows our preparedness message a few days ago and it’s a new idea to solve a problem that we see as increasing in scope.  Our solution is both convenient for all parties and is legally compliant as to how closing attorneys are required to close loans in Georgia.  It also increases safety for all parties involved, including you and us.  Our goal is to stay in place and working to close everyone’s transactions and to do that, we all need to stay healthy.  


Issue – Georgia is a wet closing state and requires the presence of a lawyer at the closing.  This is the main reason all parties come to a closing table.  This is often referred to as the East Coast style of closing, because we are a lawyer state where a lawyer is required to be present at closing.  The Western Way to close is with notaries and 44 states are non-attorney states and are allowed to do that type of closing.  The other way to properly close a loan transaction in Georgia is for the lawyer to go to the parties to close.  Each of these options requires a gathering of people that are new to each other and for many, that is fearful.  The presence of the attorney at closing is sometimes solved by the various parties sending in a Power of Attorney to handle the signing of the closing documents.  That POA is the one who comes to closing to sign original documents in the presence of the closing attorney and law firm.  This is a slight improvement in the number of people attending the closing, but it does not solve the problem completely.  What if either the Buyer or Seller does not have a person here in Georgia to be the POA?  We have a solution – us. 


Solution – the solution is to provide the POA service to Buyers and Sellers (for no additional charge to prepare the POA), and the law firm would be the POA.  This is better because the law firm, if requested, would have individuals signing for the Buyer as POA, for the Seller as POA, and as the closing attorney, thus limiting the number of individuals who would need to be present at the closing.  Our firm will prepare a specific Power of Attorney whereby the Buyer and Seller will appoint our law firm to sign on their behalf for the closing.  It is perfectly legal to accomplish this scenario, but it does appear the law firm is too involved in the transaction; therefore, we would require the parties to the transaction to give us a Waiver of Conflict and a Hold Harmless as a result of our firm serving as the POA for one or multiple parties.  In return, for any party requesting our POA services, we would send that party, via email, all of the closing documents, discuss the documents with them on the phone (or Zoom or Facetime) answering any questions that the party may have, and ask for that party’s written confirmation that the party is ready for us to act as the POA.  We would then execute all documents for each party requesting our POA services and fund the transaction.  This solution is safe, legitimate, and it requires only  minutes of contact with another person when the Buyer or Seller gets  his or her one page Power of Attorney witnessed and notarized, which will then be sent via FedEx to our offices or signed in one minute at one of our offices.  The actual closing process will likely take just as long as it does now, or longer, because the attorney will be talking a lot to the Buyer or Seller and then will receive confirmation for other staff to execute the documents using the POA.  But this will keep the same people in the office working on the file, and it keeps the closing attorney in the process so as to follow Georgia law, which requires the presence of an attorney.   


The main benefits of this Solution is that it complies with Georgia law, it keeps all parties safe, the outside parties at home, and the employees at the law firm in the same place.  None of the people involved in the entire transaction will have to gather, but will still have the option to attend closing if that party so wishes.  As we all know, it’s the gathering that is an issue as we confront this virus.  But we also know that some parties will want to come to closing in the traditional way and we are continuing to close deals in person every day. 


In discussing and offering this solution, we are looking forward to the next few months where there may be even more restrictions in the number of people who can gather at a meeting.  We are also thinking that if this virus continues to heighten the fear level of parties who do not want to attend a closing and sit with others at a closing table, or in separate rooms in an attorney’s office, or for any reason that is akin to social distancing, then this solution will help in reducing those fears and will provide a very safe and sound approach that satisfies all Georgia legal requirements and keeps us all a little bit safer. 


Note:  Each lender will have to approve the POA, in the same manner as they do now.  There should be no issue with this approval, but it is the only challenge we see in this entire solution. 


Lastly, we have always been problem solvers and “doers” and we are dedicated to being just that as we face the evolving world of COVID-19.  With the same spirit as we have handled previous challenges we are ready to handle a new one that we are facing with this virus – the challenge of maintaining the integrity and legality of the real estate closing while abiding by the social distancing recommendations that will help keep us all safe and healthy.   


Please call us with any questions, and thank you. 


O’Kelley & Sorohan