What is a Power of Attorney (POA)? It is usually a written legal document that states about one person giving to another person his authority and complete power to represent him. Basically there are two parties to it, the principal, and the agent or attorney-in-fact. The principal is the one who gives the power while the other person who receives the power is called the agent. This Power of Attorney document has to be signed by both the principal and the agent in front of two witnesses and a notary.
So how do we actually set up some one else to take decisions on our behalf? Power of attorney documentation has many options depending on the specific requirement. The different types and terms include,
- General Power of Attorney
- Limited Power of Attorney
- Special Power of attorney
- Durable Power of Attorney
- Springing Power of Attorney
- Health Care Power of Attorney
- Power of Attorney in Finance
While a General Power of Attorney covers all legal, financial and personal decisions a health care power of attorney exceptis pertaining to your medical care and treatment. A limited POA must specify details of power designated while in a durable POA the agent’s power to represent will continue to be in effect even if the principal becomes invalid, mentally unstable or out of capacity.
The securities broker who trades in a principal’s account and perform extensive investment functions on the principal’s behalf, without consulting the principal must be formally granted the power of attorney. There are many standardized legal power of attorney forms available for that are provide toclients, customers, patients, employees, or members. In some of the US states statutory power of attorney forms are made available.
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