A power of attorney is a legal document that gives a designated individual the ability act on the behalf of the "principal." The principal is the person that creates the power of attorney. An "attorney-in-fact" or "agent" is the person who receives the power of attorney. An attorney-in-fact does not have to be a lawyer and is usually a family member or close friend. A power of attorney is an important legal document and as such should only be prepared by an experienced attorney.
A person granted with a general power of attorney has the power and authority to represent and perform almost all actions that the maker would otherwise do. In short, it provides express authority for someone to represent you and handle all of your affairs. It includes the ability to enter into contracts, sign legal documents, manage finances, purchase property, change investments, and withdraw funds.
A limited power of attorney restricts the scope of a general power of attorney to perform certain specified tasks on behalf of the grantor. Typically, a limited power of attorney is used in real estate transactions or for the payment of bills. It does not have the broad powers given in a general power of attorney.
A medical power of attorney is a limited power of attorney that is used for medical care. It often works in conjunction with a living will that specifies certain medical directives.
A power of attorney ends at the time of death. A power of attorney also ends when the principal becomes incapacitated, unless it is a "durable" power of attorney that allows the attorney-in-fact to make decisions and act for the principal even after incapacity. This can avoid the need for a court appointed guardian and can avoid costly court fees and time lost during the process of appointing a guardian.
At Bauer & Associates, we can help you understand the power of attorney that is best suited for your particular situation. Don’t put your assets at unnecessary risks, contact us online or call 386-734-3313 today.