What Is Power Of Attorney For NRI?
For a Non-Resident Indian (NRI), managing a property back in the home country can pose many challenges. To prevent the geographical distance from becoming a hindrance, a Power of Attorney (POA) can be drawn. It facilitates better property management and ease of doing business. Global NRI Services lists out some crucial tips that you should keep in mind when executing a Power of Attorney.
“If you look at what you have in life, you’ll always have more. If you look at what you don’t have in life, you’ll never have enough.” –Oprah Winfrey
By definition, a Power of Attorney (POA) is a legal instrument that authorizes an attorney/individual to act on behalf of the property owner, known as the principal. The document empowers the attorney to make crucial decisions in the absence of the owner. Here, the attorney could be any person selected by the principal varying from a relative, friend, or property solicitor, to a property manager. The arrangement works best for Non-Resident Indians (NRIs) who cannot be physically present to manage their immovable asset in their home country.
Typically, there are three types of power of attorneys (POAs). These include:
Special power of attorney
In such an arrangement, the power of Attorney are limited to a particular purpose. Special POA is task-specific and ceases to exist on the completion of it. For instance, if the POA specifies right to rent, then the attorney’s rights are limited only to the letting of the property and not beyond.
General power of attorney
When a general POA is executed, broad powers are granted to the attorney to make crucial decisions in the absence of the principal. These powers include handling financial transactions, buying insurances, signing checks, filing taxes, settling claims and buying and selling a property.
Durable power of attorney
The durable POA remains valid for the entire lifetime unless the principal explicitly annuls it. However, in case the principal suffers from medical illness, a specific clause can be incorporated in the POA, stating that the attorney’s power would remain valid even if the principal becomes physically or mentally incapacitated.