Witness Requirement

Illinois law has specific requirements for a Power of Attorney (POA) to be valid. A crucial element for a valid POA is the signature of a witness in addition to the notary. This requirement applies to all Powers of Attorney, whether or not the Illinois Statutory Short Form is used.

The statute governing valid Powers of Attorney states every POA concerning real property “shall bear the signature of a witness to the signing of the agency and shall be notarized.” 755 ILCS 45/3-3.6. The statute places limitations on who may be the witness. The following are prohibited from serving as a witness:

• The attending physician or mental health service provider of the principal, or a relative of the physician or provider;
• An owner, operator, or relative of an owner or operator of a health care facility in which the principal is a patient or resident;
• A parent, sibling or descendant, or the spouse of a parent, sibling, or descendant, of either the principal or any agent or successor agent;
• An agent or successor agent for the property.

 Powers Given to Agent

For all Illinois transactions, ATG recommends that seller and buyer attorneys use the Illinois Statutory Short Form Power of Attorney for Property. Attorneys should draft these very carefully so that the correct powers are given to the agent. In general, “a. Real Estate Transactions” should be selected as one of the powers given to the agent. In Section # 3 of the Power of Attorney, the attorney can limit the broad powers listed in “a. Real Estate Transactions” to include a closing specifying a certain property address.

In addition, if the buyer’s agent is using an Illinois Statutory POA to sign the mortgage, “m. Borrowing Transactions” must be selected as one of the powers. Per the statutory language on the form itself, only Borrowing Transactions authorizes the agent to “borrow money; mortgage or pledge any real estate…as security for such purposes.” 755 ILCS 45/3-4(m).

As an alternative to selecting “m. Borrowing Transactions,” under Section # 3 of the Illinois Statutory Short Form POA, the attorney is free to put in specific language, such as “execute a mortgage,” or “sign a mortgage,” on behalf of the principal.

Similarly, for buyers using an agent to sign the mortgage, all non-statutory Powers of Attorney must also contain specific language indicating the power to “mortgage the property” or “execute a mortgage” or similar language in order for ATG to approve the POA. A general statement such as “sign all documents for the closing” is not sufficient.

In those situations where an agent is deeding the property to himself or herself, the POA must contain specific language authorizing the agent to execute the deed with the agent as grantee.

As a reminder, when an agent signs either a mortgage or deed on behalf of the principal, the POA must be recorded. Always use Powers of Attorney that are in proper recordable format so that the recorder's office does not charge additional fees.

Please ensure that all Powers of Attorney conform to these very specific requirements so your closing is not delayed. Questions? Contact an Underwriter.