Correction Agreement - Limited Delegation Right - Just "Limited" is it?


One of the documents the borrower may need to sign at closing is a correction agreement - a limited power of attorney.

This is a type of document that can evoke suspicions of borrowers. What kind of "attorney's power" is this? And what is the lender trying to do with this "power"? And what kind of "correction" will be the lenderpower create?

What I am trying to do is relieve the borrower by explaining what this contract is used for. First of all, it is the authority of a lawyer, which means that there is a limit to what lenders are authorized to do. The document looks like this:

In consideration of the XYZ mortgage company, the purchaser (borrower) who signed, in the case of a claim by the lender or his agent, successor, or assignee, I / we fully cooperate and all The error was detected in some or all of the closed documents presented at the time of closed closure.

The signer acts for me / us for me / me to correct such errors and place my / initials in changed documents and sign my / our name I have the right to do lawyers / all the acts that are necessary or necessary to achieve such adjustment / correction of such errors. If this procedure is used, the borrower shall be notified and receive a corrected copy of the document changed from the lender. This power of attorney shall take effect on the date of this Agreement.

The power of attorney created here is a permanent power of attorney and will not be affected by subsequent disability or incapacity.

I am a notary representative. I am not a lawyer and may not have legal advice. But one thing that I guarantee to borrowers is that this is an agreement to correct 'clerical errors'. Also, this is a "correction" contract. Transformation & # 39; Agreement. In other words, lenders will not use this contract to change interest rates or other loan terms. The fixed interest rate remains fixed rate. If there is no prepayment penalty, it will stay intact. etc.

Yes, but how long do lenders have this power?

It is a good question and borrowers should consult their lending staff. However, typically the attorney's authority ends when the power of attorney dies. It may be a long time. However, this kind of power of attorney usually ends in one year.

This is basically about the correction contract - limited agent. It is mainly used for borrower's convenience.

The convenience of the borrower is also the main purpose of the notary organization.


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