Why Real Estate Investors Need the Power of Attorney

When making creative real estate deals, having a document like the Powers of Attorney can offer a huge advantage. You, the attorney, becomes the grantee of the property, giving you the power to handle the property however you see fit, by the owner of the real estate, who is the grantor. This document can have no limitations or can be irrevocable or revocable or specific or general for a specified time period. The bottom line is that there is a lot of flexibility when it comes to the Powers of Attorney.

Scenarios That Need the Powers of Attorney

Agreements for Sale

When it comes to Agreements for Sale, that’s when the Power of Attorney is really needed. In this scenario, the Power of Attorney allows you to take control of the real estate without holding the title in any way. The Power of Attorney gives you power in no equity or low equity Agreements for Sale, allowing you to make deals and issue instructions to people who might have a problem with you not being the title holder, such as insurance companies, condominium corporations, lenders, joint venturers and buyers.


When the tenant wishes to buy the property they are renting, they have the right to express interest in the title by filling an official notice. If you wish to discharge this tenant’s notice/caveat, you may need to have a Power of Attorney that is limited in these scenarios and filed at the Land Registry/Title Office. In most cases where there is a collapsed Rent-To-Own transaction, the tenant buyer has gone missing because they want to back down from the agreement without assisting in the recovering of the property. The tenant may not even discharge the notice/caveat he/she made.

If the tenant buyer seems reluctant to grant you the Power of Attorney, you could include a provision in your Rent-To-Own agreement that gives you limited Power of Attorney, allowing you to only discharge the notice/caveat in the case of a collapsed notice/caveat.

Renovation Prior to Taking Ownership

Sometimes, contractors, local municipality and insurance companies can refuse to deal with you if you are not the owner of the property. When this happens, you can just take out the Power of Attorney, which gives you the power to perform renovations that would normally require things like municipal permits and/or third-party permissions before the is closed.

The Power of Attorney Also has Some Disadvantages:


The more documents there are in a deal, the more complicated it becomes; unfortunately, the Powers of Attorney is another document. Since there is no one deal that is suitable for everyone, the terms and conditions of the document must be negotiated. This means getting the appropriate Powers of Attorney, although worth it in the end, takes a lot of time and money


Since the most fraudulently used document is the Powers of Attorney, banks are not a fan of them; making the document and faking the owner’s signatures as well as signatures of witnesses, notaries or commissioners for oaths is not difficult. Despite banks being nervous about these documents, refinancing or exiting Agreements for Sale is difficult without the Powers of Attorney. This means you, as the lawyer, would have to prove that the document is authentic. Besides that, dealing with other people or entities with interest in the real estate is not that difficult.


People get nervous when it comes to granting their attorney a powerful document like the Power of Attorney. This is because it dawns on them that control of their property is going to someone else. Your job as the lawyer is to convince them that you can’t effectively do your job without the Power of Attorney.

Real Estate in Alberta and the Power of Attorney

When it comes to Alberta, the Power of Attorney we use in all Agreements For Sale has been updated. Two big alterations have been made since it was first introduced. Please note that every province has different rules when it comes to the Powers of Attorney, and you need to obtain legal advice regarding the province your transaction is taking place.

  1. Firstly, the Powers of Attorney is now irrevocable. No one wants sellers to revoke the Powers of Attorney whenever they feel nervous about you having it.
  2. Secondly, there is now a clause allowing the attorney, which is you, to transfer the real estate to your agent or yourself if you don’t want to be limited when transacting with third parties. The Alberta Land Titles Act now requires it. In situations where there is an Agreement for Sale, you are required to transfer the property to yourself so that you can refinance or enter an agreement with a buyer who is a third party.

As you can see, the Powers of Attorney are indeed a powerful and flexible tool when it comes to taking control of a number of scenarios in the real estate industry.


This article is for entertainment purposes only and should not be construed as legal advice. If you have any questions with respect to the above information or any other legal matters, please reach out to me directly via email at julian@hutchlaw.ca or via telephone at 613-286-2169.

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