Irrevocable power of attorney (3)
This is the part three, the last part of my article about why you should not sign an irrevocable power of attorney
Fairy tales, half-truths and lies.
When I ask people why they signed their irrevocable power of attorney, they tell me this:
‘’The bank told me it was required when selling a house with a residual debt’’
‘’The bank told me it was required by NHG, otherwise I would lose my right to remission’’
‘’The bank told me I needed to sign the power of attorney, otherwise NHG would not pay the agency fees’’
‘’The bank threatened to start a foreclosure auction if I did not sign the power of attorney’’
‘’The bank threatened to send a bailiff if I did not sign the power of attorney’’
Let us take a look at the facts
- No, you are not obligated to sign a power of attorney if you must sell your house with loss.
- NHG would never oblige you to sign a power of attorney and it has nothing to do with your remission.
- NHG has set standards for brokerage fees and they have nothing to do with the presence of a signed power of attorney.
- And no, you are not obligated to hand in your keys and give all the control to another party, a threat with a foreclosure auction or a bailiff changes nothing.
Are there situations where the power of attorney is the solution?
Perhaps yes. For instance, homeowners who can´t act independent. Or houses out of an inheritance which bring up complications for heirs, like making the sale.
But in most of the cases it is not clever to give all the control to the bank. Especially with no way back!
The danger of an irrevocable power of attorney
It is easy to see if you look at the owners who were unpleasantly surprised, after signing the power of attorney.
The owners were never told they did something wrong, like not obeying the rules or that their full cooperation was in danger.
They were told when it was almost too late. I deliberately say almost, because there was a possibility of objection, against the decision. But it is better to prevent something than to recover from it.
All progress was brought to a grinding halt for the owner who still needed to sell his house, when his signature was put on the paper.
The power of attorney was given and the money taken. He was ofcourse urged to keep on paying when the bank dawdled.
The power of attorney was presented as a gift which spared time, effort and energy. But like your mother told you: ‘’If something is too good to be true, it is not true’’.
A few oversized glitches are hiding under the power of attorney.
So if you are in a loss situation, do not just sign. You will probably lose more than you will win.
Nobody cares as good for you as you do. Even when the bank has the best intentions, she will always look at the benefit for the bank first. Your interest is second. That is not good or bad, it is just the way it goes. So keep it in mind.
If you have any questions about selling your house, selling with a mortgage debt or other related affairs, please contact me or leave a comment below this article.