Durable Power of Attorney – Finance

Durable Power of Attorney – Finance

Understanding Durable Power of Attorney as it applies to finance is important for all involved. After reading the general information below, let us know if you have specific questions. You are entitled to a Free 30 Minute Legal Consultation related to any of our specialized areas.


What is a Durable Power of Attorney?

Power of Attorney – A “power of attorney” gives one person the legal authority to make binding decisions on behalf of another person. In this case we are discussing financial decisions.

Durable Power of Attorney – “Durable” means that the power is still effective if the principal is incapacitated. However, once the principal dies, the agent’s authority ceases.

Principal & Agent – The person granting the authority is called “principal”. The person who is authorized to act on behalf of the principal is called the “agent” or “attorney in fact”. An agent under a power of attorney for finances can manage any of the principal’s financial affairs. The principal can give the agent any instructions, guidelines, or limitations he or she feels are appropriate.

Durable Power of Attorney for Finances – The Durable Power of Attorney for Finances (DPAF) is valid for an indefinite period of time, unless a specific expiration date is in the document. The principal can revoke the document at any time. A person must have capacity in order to sign and authorize a power of attorney. Moreover, only a trustworthy person over the age of eighteen should be chosen to act as an agent. A DPAF that meets the requirements of California law may or may not be recognized in other states. A principal who spends much time in other states, may want to consult a lawyer in the other state to find out about the laws there.


What is a Special Power of Attorney?

A person can also sign a Special Power of Attorney for a specific transaction. For instance, if you are out of the country at time when you must sign-off on paperwork related to the sale of your house, a Special Power of Attorney may be drawn up for a finite period of time so that a specified person may sign papers in your absence on your behalf.