People get a Durable Power of Attorney in place to help make decisions for their parents or other relatives - to handle their finances such as taxes, bills, bank accounts, investments and real estate sales if they become incapacitated.
The time then comes when you need to help out your relative and you bring the witnessed and notarized document to a financial institution to only find out that they won't honor it.
They insist that the account owners sign the institution’s own power of attorney form, but at this point it's too late, as the family member is no longer competent to sign legal forms.
So how does this happen?
The financial institutions legal department reviews the document and, based on their concerns, are not comfortable. They have a legal obligation to protect the account holder as well as the financial institution.
So what do you do? Here are your options:
- You can go to the manager within the financial institution and hope that they will honor your valid power of attorney agreement. But there is no guarantee that this will happen.
- You're better off taking your new durable power of attorney document, prepared by a lawyer, to the financial institution to seek their approval of the document. If they are not comfortable with it, they should tell you why. You can then bring your version back to an attorney to get additional language added that would meet the financial institutions guidelines. Then bring it back and make sure they approve it.
Some financial institutions do offer durable power of attorney documents of their own, but those documents may contain advantageous indemnity or arbitration clauses, or provisions that contradict the individual’s general power of attorney.
Keep in mind what you want is a durable power of attorney, not just a power of attorney document. The document has to be durable so that you can make decisions if the family member or friend becomes incapacitated.
Date Posted: 05/25/2016 Advice provided in this article is meant for educational purposes only and financial education is important to us. Before making decisions regarding your personal financial situation, please consult an advisor or conduct your own due diligence. If you would like to discuss your Retirement Income Plan with an HCM Wealth Advisor, please give us a call – 513-598-5120. Located in Cincinnati, Ohio, we serve clients in 28 states, and we’d love to help.