Signing Loan Documents Under Power Of Attorney

Many lenders have no restrictions on whether loan documents can be signed by individuals under powers of attorney. We recently reviewed whether guidelines would be wise.

This article deals with powers of attorney granted by individuals, not powers of attorney granted by companies.

The starting point is, that there is no doubt that a valid power of attorney can be created, and so long as the power of attorney is registered, the attorney can sign documents in relation to land. There are statutory protections for people dealing with attorneys. However, it is likely those statutory protections won't save lenders who have allowed the attorney to enter a transaction which the lender knew or ought to have known was not for the benefit of the donor – the person who granted the power.