Why should you pay an attorney to handle your closing? A recent revision to the Opinion of the North Carolina State Bar reveals many reasons why you want an attorney to handle your closing. To begin with, your “closing” isn’t just the 45 minutes it takes you to sign a stack of papers. It’s actually a collection of more than 10 tasks that are completed before, during and after the signing of that stack. It includes (a) reviewing the purchase agreement, (b) abstracting titles, (c) providing a title opinion, (d) preparing legal documents, (e) interpreting and explaining documents in the stack, (f) resolving clouds on title, (g) overseeing proper document execution and acknowledgement, (g) recording and cancelling documents, (h) properly and legally disbursing proceeds, and (i) providing the final title opinion.
Recently in North Carolina, non-lawyers have advertised that they can complete your closing at more convenient times (after hours or on weekends) or for an extremely low price. As in many other service areas, you get what you pay for. The State Bar weighs in on this, too, by stating that “[O]n the whole, the evidence considered by the State Bar indicates that it is in the best interest of a consumer to be represented by a lawyer with respect to all aspects of a residential real estate transaction.” This is because a lawyer is bound by fiduciary and ethical rules to protect the consumer, and mishandling by a lawyer leaves the consumer with possible financial recoupment. So in the rare instances when lawyers falter, there is swift repercussion for the lawyer and financial recovery for the client. But in the more common instances when non-lawyers fail, the consumer gets stuck with the problems—both practical and financial. There are criminal sanctions and possible economic recovery for the consumer if a non-lawyer attempted to perform tasks that only lawyers are authorized and capable of handling, but they do not undo the harm or delay that has already occurred.
So the next time you or a friend is considering saving a few bucks by allowing a non-lawyer to perform any of the tasks above, think long and hard about the risk you are taking. I hope you’ll agree with the State Bar by concluding that hiring a lawyer to handle all the tasks of a closing is a much better bet.