Reply #24: No, but you probably should

[primavera]

I've gone through two closings and, on both occasions, the closing attorney didn't receive the documents from the mortgage company until the morning of the closing, so there was no opportunity to review the documents with an attorney prior to the actual closing. Once you're in the closing, there's a great deal to sign and very little time in which to read it and, even if you do manage to read it, will you know what all of the legalistic terms mean when you see them? A perfect example is the term "marketable title," which many mortgage companies and closing attorneys have adopted into their standard forms. The problem is that "marketable title" doesn't mean anything. If you look in the fine print for a definition, it will tell you that marketable title is a title which a reasonable person would consider to have value. What value? The value of the property or the value of a six pack of Coors Lite? It doesn't say. By this nonexistent definition, "marketable title" could include a life estate, a future interest, a partial interest, a deed with encumbrances, restrictive covenants, or equitable servitudes attached, or it could be the perfect title that you as the buyer want. "Marketable title" is therefore a bogus term that means precisely squat, yet you're signing off on these forms agreeing to pay X hundreds of thousands of dollars for it. Does it happen often that you get shafted in this way? No, litigation is a rarity in these transactions, but it's always a remote possibility that you'll be the unlucky sap who gets hosed.

An important thing to bear in mind is that the closing attorney whom you're paying does not represent you. Closing attorneys collect a couple of hundred bucks from the buyer to cover administrative costs like photocopying and express mail and filing fees and such, but they are paid a very great deal more in commissions from the mortgage and insurance companies. The corporate entities at the closing will have in-house counsel who draft the standardized forms you will be signing, so you know their interests are being thoroughly protected. The closing attorney's duty to his real clients is therefore to push the deal through, not to protect your interests. It is therefore in the best interests of the closing attorney and his corporate clients if you just blithely go along and sign everything quickly without bothering to read any of it. That is why the system is set up so that you will not receive the documents to review in advance with an attorney of your own. And, if you decline to sign at the closing on the grounds that you want your attorney to review them before you sign, you can be sued for breaching the sales contact by failing to close on the date stipulated.

For all of these reasons, if you want to be extra cautious about watching your ass - which, again, you probably should be because you can be quite certain that no one else is - then you should take pains to obtain copies of as much as is humanly possibly prior to the closing, and make sure you understand what it all says before you go into your closing. And, yeah, you'll probably need an attorney to help you understand what it all means, because property law is incredibly cryptic and arcane and totally filled with anachronistic terms and legalistic mumbo jumbo which even attorneys have an extremely hard time following. Or, you can trust to luck, sign where you're told and, odds are, it'll probably be just fine... unless it isn't.