Condo Closing Questions - Who Pays Closing Costs?
Ask the Real Estate Lawyer: Real Estate Law Q&A
By Ilyce R. Glink and Samuel J. Tamkin
Summary: Who pays closing costs? A couple asks for real estate advice after incurring costs in a closing that they believe they should not have had to pay.
Q. We signed an agreement to sell our condo in Florida. The agreement named the buyer but next to the buyer’s name were the words “or his assignee.”
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When we went to sign papers for the closing, the closing attorney changed the buyer’s name on the documents to another buyer and charged us $500 for a power of attorney. We were ill and could not attend the signing in person. He also delayed the closing by four months and it cost us an additional $150 in taxes and maintenance expenses.
We complained to the Florida Bar but they stated that they did not have jurisdiction over this matter and they stated that our complaint does not involve any ethical breach by the attorney.
Please try to help us regain the loss of the original deposit the original buyer paid the closing attorney.
A. Let’s recap what’s happened to you: You sold your place and it seems you got your selling price but with a delay in the closing. You didn’t indicate why the closing was delayed, but seem annoyed that you had to pay for the taxes and maintenance expensed during the delay. Now you want to know how to get your money back from the closing attorney.
If the delay was permitted under the terms of your contract for sale and the sale was completed, you should have nothing to complain about. If the buyer delayed the closing, you should have objected to the delay prior to closing or agreed to a delayed closing by having the buyer agree to assume the costs for your home from and after the closing date stated on your agreement to sell your home.
You did not describe the circumstances that allowed the second buyer to become a party to the contract. If the second buyer came into the transaction fair and square, he probably signed an agreement to buy out the first buyer and assume his obligations under the contract.
It appears your first buyer either intended to sell his rights under the contract or wanted title to end up in someone other than himself. By placing the words “or his assignee” after his name, he was telling you that the title to the home would end up in either his name or in the name of someone else if he assigned the rights under the contract.
Other than the additional expense of carrying the place, you were able to sell it and received what you were entitled to under the contract. As for the fee to handle the power of attorney or other documents, I can’t tell from your letter if the closing attorney over-billed you for his services.
If the closing attorney advised you of his fee and you agreed to it, you shouldn’t complain after the closing. If he charged this fee without telling you, he was wrong in doing so.
It seems that the Florida Bar reviewed your case and did not believe the closing attorney did anything wrong. They are probably correct. You may not have understood the consequences of the transaction or the documents you signed.
The attorney that handled the transaction apparently was a “closing attorney” and did not represent you in this transaction. He merely drafted documents and facilitated the closing.
In states that do not customarily have a buyer hire an attorney to represent the buyer’s interests and a seller hire an attorney to represent a seller’s interest, buyers and sellers must rely on themselves to seek out the assistance of someone other than the closing attorney.
Samuel J. Tamkin is a Chicago-based real estate attorney. Ilyce R. Glink’s latest book is The REAL U Guide to Bank Accounts and Credit Cards. This column is distributed by Real Estate Matters Syndicate. This column may not be resold, reprinted, resyndicated or redistributed without written permission from the publisher. If you have questions for Sam and Ilyce, write: Real Estate Matters Syndicate, PO Box 366, Glencoe, IL 60022 or contact them through Ilyce’s website www.thinkglink.com.