Loan Documentation Review and Representation. Loans are complicated financial instruments, and it is always a good idea to have an experienced real estate attorney carefully review these documents. This is particularly important when it comes to the terms of promissory notes, which are the legal agreements – prepared by a lender – that obligate a borrower’s commitment to repay a loan. As your law firm at closing, our job is to review the financial documents that have been prepared to make sure that everything is in order and that you’re not assuming an obligation that you shouldn’t be.
Title insurance examination and coordination. Title insurance is required whenever a bank or other lender will be providing financing. Title insurance benefits both you and the lender, as you will both want to be sure that your property is free of any encumbrances that would adversely impair title (such as pre-existing liens). For instance, you would not want to find out after buying your property that your house encroaches upon property owned by a neighbor, or that another lender has a significant lien on your property. Our role is to examine the title reports for these or any other title “exceptions,” advise you of our findings, and determine what actions need to be taken to “clear” such exceptions. It is important to understand that virtually all property will have some encumbrances, such as utility easements. But what is important is to determine whether there are any other encumbrances that would adversely impact what is known as “good and marketable title.”
Your Closing. The best closings are the ones that go quickly and without any unexpected disruptions. Our role is to work with banks and other lenders, escrow companies, title companies, and real estate agents to ensure that all documentation is in place at time of closing so that any prior property encumbrances are discharged, and the proper funding takes place. In Massachusetts, for purchases we generally perform a 50 year title search and are required by law to certify title.
Post-Closing Matters. Once the paperwork is signed, there are a number of actions that must take place, including:
- Disbursement of sales proceeds among banks and lenders, real estate agents, title companies, and others
- Record mortgage as well as lien releases from prior lenders,
- Record deed on behalf of the new buyerYou should know that under federal law, you have the right to request your own attorney to represent you at closing. You DO NOT have to use an attorney from your lender’s approved attorney list.
- Massachusetts law does, however, require that real estate closing attorneys be used in connection with all residential real estate closings. Not only must a Massachusetts attorney be at a closing, he or she must take an active participation role in the closing. “Active participation” includes:
- Massachusetts Law and Real Estate Closings
- Analyzing title opinions and providing an opinion of clear and marketable title
- Drafting deeds
- Effectuating closing transactions