Power of Attorney for Property
What You Should Know
- A Power of Attorney for Property is a legal document that grants an individual the authority to make decisions on property matters for someone else.
- A General Power of Attorney allows for managing authority over finances and property only while mentally capable, while a Continuing Power of Attorney enables an attorney to manage affairs even if the individual becomes mentally incapable.
- An attorney is responsible for managing a person's property on their behalf, but does not become the owner of it.
What is a Power of Attorney for Property?
Power of Attorney is a legal document that allows an individual to appoint someone else to manage their financial affairs. This document is especially important for those who are unable to manage their own finances due to age, illness, or disability.
With Power of Attorney for Property, the appointed individual is given the authority to make decisions on property-related matters. The person you appoint does not have to be a lawyer and is called your attorney or substitute decision-maker.
Things to Note 💡
It is required that a person be ‘mentally capable’ at the time of signing a POA for it to be valid. It should be noted that POA names, laws, requirements and definitions vary across provinces and territories in Canada. In real estate, your attorney can manage buying or selling of real estate in your name, pay bills on your behalf and even collect money owed to you, unless restricted to do so. Your attorney does not become the owner of your property and can only manage it on your behalf.
Different Types of Power of Attorney
There are two types of POA commonly used in matters of real estate:
General Power of Attorney:
Signing this would give your attorney managing authority over all or part of your finances and property only while you are mentally capable of managing your own affairs and becomes invalid if you become mentally incapable. The definition of mental capability varies across provinces. This type of authority can also be limited to a particular task such as selling a house or could be given to the attorney for a specific time period.
Continuing power of Attorney:
This is a legal document that allows your attorney to continue managing your finances and property even if you become mentally incapable to do so. It can start as soon as you sign it, or sometimes if specified in the document, it may come into effect when you become mentally incapable.
Disclaimer:
- Any analysis or commentary reflects the opinions of WOWA.ca analysts and should not be considered financial advice. Please consult a licensed professional before making any decisions.
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- Interest rates are sourced from financial institutions' websites or provided to us directly. Real estate data is sourced from the Canadian Real Estate Association (CREA) and regional boards' websites and documents.