A Durable Power Of Attorney is a written document under which an individual (principal) designates another person as an attorney in fact or agent to manage the person’s property and other personal affairs, excluding health care. The principal provides the agent with general or specific powers as she/he chooses. The DPOA authorizes the agent to engage in certain specified financial or business transactions, on behalf of the principal, with third parties including financial institutions, banks, escrow, title companies, brokerage companies, etc.
The term Durable in Durable Power of Attorney means that the Power of Attorney grants the agent the authority to act on behalf of the principal even if the principal is deemed disabled or incapacitated. Generally, a DPOA may take effect in two ways: at the time it is executed or spring into effect at the time when the principal becomes incapacitated, disabled, or if some other stated event takes place. Disability or Incapacity may be defined in the DPOA, otherwise the principal will be considered disabled or incapacitated, if a licensed physician certifies in writing that the principal is incapable of managing her/his financial affairs.
A DPOA may also make it unnecessary to appoint a conservator to take charge of your estate and thus avoid court involvement in sensitive family affairs. Conservatorships are generally cumbersome and costly arrangements.
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