Question: My husband and I are about to buy our first home in Florida. We have a disagreement about whether we need an attorney to help close the sale. He thinks we'll pay more for title insurance. He says an attorney isn't necessary because the title company can do anything an attorney can do. He also said the mortgage company will tell us what settlement agent to use so there really isn't an issue about finding an attorney. They do that for us. Is he right?
Answer: Your husband has the same ideas as many who aren't familiar with the variety of issues that impact a real estate closing. There are several really good reasons for you and your husband to seek the help of an attorney during the closing process for your new home.
First, consider the cost of insurance. The promultaged rate for the title insurance premium is the same everywhere in Florida whether the closing is conducted by an attorney or a title company. The rate is based upon the selling price of the house and is mandated.
Second, a title company is, by definition, a business that examines and insures claims to title. It is not licensed to and is, in fact, prohibited by law from giving legal advice.
Difficulties encountered during the closing process may require legal advice from an individual who is licensed to provide that advice. If you and your husband aren't sure about how to take title, you will need an attorney. If you aren't sure about the tax implications of the transaction, you will need professional help. If the seller tries to get out of the contract or change the terms, you will want guidance. Even if a problem is discovered about the property's existing title, you will need legal advice. Sometimes the title has to be cleared through probate or a tenant has to be evicted before you can close. In today's economy, many closings involve a short sale and/or a bankruptcy. Having an attorney begin the process with you will avoid some problems at closing, but more important if last minute problems arise, you will already have a licensed professional in place.
Third, the mortgage company cannot tell you who your settlement agent should be. The federal Real Estate Settlement Procedures Act gives you the right to select your own settlement agent. You would certainly want an attorney of your choice, not one who has been identified by the mortgage company that might be the source of the conflict.
Attorney Sylvia Heldreth is a certified specialist in real estate law. Her office is located at 1215 Miramar St., in Cape Coral.
This article is not intended as specific legal advice to anyone and is based upon facts that change from time to time. Individuals should seek legal counsel before acting upon any matter involving the law.