Reply by PAW on 10/9/09 8:12pm
Msg #306887
Opinion of a Georgia attorney on this subject:
Below is an excerpt from an opinion by a Real Estate Attorney with over 30 years experience. (12 years of private practice and 17 years as the real estate lawyer for a Fortune 200 Paper and Timber Company. Now semi-retired and specializing in "Witness Only" closings in Southeast Georgia.)
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Question (2), "Is a lawyer required for a closing when the borrowers are located in Georgia but the real property given as security for the loan is located in a state other than Georgia? It appears that the Supreme Court decision referenced above, although not specifically addressing the question presented, did not limit its Opinion to real property located in Georgia and would clearly require that a lawyer conduct the closing in this situation. The practice of law, as it relates to conveyancing, is an activity unrelated to the location of the property involved. As the Georgia Supreme Court has ruled that the actions of overseeing the closing, reviewing and explaining documents and obtaining signatures constitutes the practice of law in Georgia, the location of the real property is immaterial. It is the actions, in the State of Georgia, of the individual conducting the closing which are subject to Georgia Law, not the property itself. If those actions are conducted in Georgia then it is highly likely that the Court's Opinion applies and a lawyer is required. My only caveat to this position would be a loan closing conducted in Georgia but involving real property located in those states which use Mortgages (or other instruments which merely create a lien against property) as opposed to Security Deeds or Deeds to Secure Debt. Security Deeds and Deeds to Secure Debt, as used in Georgia, actually convey legal title to the property used as security for the loan to the Grantee, the lender, while leaving the Grantor, the borrower, with equitable title. Mortgages, on the other hand create a lien against property used as security for the loan but leave legal title in the landowner, the borrower. Since the rationale of the Supreme Court opinion rests, at least in part, on the fact that only lawyers may prepare and supervise the creation and execution of a "deed of conveyance", the Court might hold that a closing conducted in Georgia but involving a loan secured by a mortgage on real property in another state does not constitute "conveyancing", because of the lack of a "Deed of Conveyance", and thus conducting such a closing might not constitute the practice of law. However, even in this situation, it is more likely that the Court would hold that a mortgage conveys a lien from Mortgagor to Mortgagee and is thus a conveyancing transaction, regardless of the absence of a "Deed of Conveyance".
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It must be stressed that the answers to question above is strictly the opinion of the attorney! Readers should consult their own attorney concerning the legal status of their own actions in those situations.
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I'm about 90 minutes south of the Georgia line - about 5 hours out of Atlanta...