How to Purchase a Home Without Using a Lawyer
My question involves real estate located in the State of: Massachusetts
I am planning to purchase a single family home. There is no mortgage, the purchase is all cash. I would like to represent myself at closing, without an attorney. The seller is represented by an attorney. Questions:
1) Am I allowed to close without an attorney? if yes, then
2) What is required to record a deed in the registry of deeds? Is there anything except the quitclaim deed (prepared by the seller) and recording fee? Do I have to record the certificate of municipal lien (CML)?
3) Am I allowed to prepare Closing Disclosure myself without an attorney? Is the seller responsible for his part or will I have to figure out prepaid taxes and water minimum for him?
4) Are there any other documents besides Closing Disclosure and recording of the deed and CML that are my (buyer's responsibility)?
Thanks.
Re: Buyer's Requirements at Closing
Not only would I not close without a title search, I wouldn't even take a gift of property from my sainted aunt without owner's title insurance to back up that title search.
JK is 100% right here in what could go wrong. Further eschewing a proper closing, can result in you getting left on the hook for things the other property should rightfully be paying for (prorated taxes, utilities or other assessments, etc...).
Further using a self-written deed may not convey what you think it does (even beyond JK's points about the seller not having the interest he claims he is conveying). Even the property I sold to one of my tenants which we did without real estate agents, etc... I paid my attorney to handle the actual closing and filing the deeds, etc...
Re: Buyer's Requirements at Closing
Real simple - no attorney is required to sell property of any kind.
In essence, you could sell the Brooklyn bridge (if you owed it) simply by issuing a document stating you are selling it and releasing any future claim to it. You would have to register this with the courts.
Now all that said, it is not wise to do so without notarization, and title insurance.
Re: How to Purchase a Home Without Using a Lawyer
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ilya980
Am I allowed to close without an attorney?
You can buy the home without retaining a lawyer. Whether or not it's wise to do so is a separate matter; many would say that it is not, especially when the seller has a lawyer.
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Quoting ilya980
What is required to record a deed in the registry of deeds?
You would need deed that is prepared and executed in proper form. If the seller is not preparing a deed, you should consider using a real estate professional or your own lawyer to prepare the deed.
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Quoting ilya980
Is there anything except the quitclaim deed (prepared by the seller) and recording fee?
You should insist upon a warranty deed.
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Quoting ilya980
Do I have to record the certificate of municipal lien (CML)?
It is routine in Massachusetts for a Municipal Lien Certificate to be recorded along with the new deed following a real estate sale. The filing is for your protection.
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Quoting ilya980
Am I allowed to prepare Closing Disclosure myself without an attorney?
A Closing Disclosure provides information about a mortgage loan. You have indicated that there is no loan.
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Quoting ilya980
Is the seller responsible for his part...
His part of what?
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Quoting ilya980
...or will I have to figure out prepaid taxes and water minimum for him?
Obviously, you would want to figure out taxes and prorate taxes for the year, such that you only pay taxes post-closing.
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Quoting ilya980
Are there any other documents besides Closing Disclosure and recording of the deed and CML that are my (buyer's responsibility)?
Mortgage closings often involve a large stack of legal documents. What you may or will need in your case is not something I'm going to guess about in the abstract.
Re: How to Purchase a Home Without Using a Lawyer
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You would need deed that is prepared and executed in proper form. If the seller is not preparing a deed, you should consider using a real estate professional or your own lawyer to prepare the deed.
Again, as of a decision two years ago, preparation of deed by someone other than ther person executing it requires an attorney in Massachusetts. A real estate "professional" should know that is outside the scope of their licensing.
Re: How to Purchase a Home Without Using a Lawyer
Thank you for all the detailed replies.
1) The deed is prepared by the seller's attorney who will also preside at closing.
2) Wise or not wise to close without an attorney is a separate issue, but from your answers it is legal. Thanks.
3) There is no third party involved, only the seller, seller's attorney, and the buyer (myself).
4) Unfortunately, I have no leverage to insist on warranty deed. I can politely request, but I probably will not get it. In our market quitclaim deeds are common. I bought my first house with a quitclaim deed 6 years ago. Also, it is such a strong seller's market (at least in my area) that I was competing against multiple offers, and the seller's position was to spend the least amount of money and do as little as possible. Is there any law that would require seller to produce warranty deed?
5) You didn't answer about MLC. You are saying it is "routine", but is it required by law? Yes, it protects me against possible liens from town, water department, unpaid sewer, etc. But this is already written in the P&S. "SELLER states that to the SELLER’s knowledge there are no lawsuits currently pending or threatened which will in any way affect title to the premises".
6) A Closing Disclosure not only provides information about a loan (which I don't have), but also shows, for example, taxes and other government fees (page 2 part E), which have recording fees, and transfer tax. In the previous closing we used HUD-1, which had separate lines for obtaining MLC, recording MLC, prepaid property taxes, and prepaid water minimum. I don't see these lines in the closing disclosure. Where does this information go now? Should we still use HUD-1? Also, there will be leftover in the heating oil tank. Where does this information go?
7) Paid taxes are public records on every property (at least in my county). Figuring out my share of post-closing taxes should not be difficult, because the amounts seller has paid is public information. To figure out prepaid water minimum I would need last water bill from the seller.
8) There is no mortgage closing. The only thing we did from the buyer's side in the previous closing (6 years ago) was the HUD-1, MLC, and the money, of course. MLC and quitclaim deed were recorded at the registry. I had an attorney who wrote HUD-1 and obtained and recorded MLC for me. I am trying to do it myself now.
Re: How to Purchase a Home Without Using a Lawyer
I disagree. Quit claims are far from common in any market for a house sale. They have their use, but THIS is not one of them.
Your purchase contract should have required them to convey the property by clear title, not just a disclaimer that they gave up whatever interest they had. You should have had a lawyer at the time the contract was made.
It cost a REPUTABLE seller NOTHING to give you a general warranty deed. It only costs him if he DOESN'T really have clean title.
Having the seller's attorney prepare the closing accounting isn't unreasonable (generally it's the buyers call, but if you chose to go that way, that's up to you).
I'd still get owner's title insurance. Especially, given the dubious conveyance involved here.
Re: How to Purchase a Home Without Using a Lawyer
You can contact the owner directly.