Tue. Nov 24th, 2020

Tips About Power of Attorney Authority

4 Types of Power of Attorney: What You Should Know

Power of Attorney (POA) is a legal document giving a trusted person, also known as an “agent”, broad powers to act on behalf of another person, legally termed the “principal”. POAs are often needed when someone becomes incapacitated. You may find yourself either needing to obtain the power of attorney Raliegh NC or have that status granted to another on your behalf. 

Four Types of POA

There are four common types of POA:

  • General Power of Attorney. In this common type of POA, the agent is authorized to act broadly on behalf of the principal.
  • Durable Power of Attorney. This agreement enables the agent to act on behalf of the principal, and continue as the agent if and when the principal becomes incapacitated.
  • Special or Limited Power of Attorney. In this type, an agent has the authority to act only in a specific and restricted set of circumstances.
  • Springing Power of Attorney. In this special case, the POA becomes effective when a specific event occurs, such as a principal becoming unable to care for their own needs.

Keep in mind that all POAs become null and invalid upon the principal’s death.

Tips on Selecting a POA Agent

Because the agent in a POA has such broad authority over another’s affairs, the selection of the right person for this role is quite important. Selecting a power of attorney is not necessarily about choosing someone close to you, but rather someone who can represent and act upon your wishes as you would. Here are a few important considerations to assess:

  • Does the potential agent live nearby?
  • How well does the agent know the principal?
  • Is the agent trustworthy and competent in financial affairs?
  • Does the agent communicate well?
  • Is the person willing to serve in this capacity?

Indeed, you may find yourself in a situation where you may be asking yourself these questions.