Purchasing or selling a home could possibly be one of the biggest decisions a person makes in their lifetime. Since buying or selling involves real property, it is important to have a real estate attorney to assist with closing the transaction. You may ask “but WHY do I need an attorney? I’ve lived in other states and didn’t need an attorney.”
In South Carolina, the Supreme Court actually mandates “that real estate and mortgage loan closings should be conducted only under the supervision of attorneys, who have the ability to furnish their clients legal advice should the need arise…” State of South Carolina v. Buyers Service Co., Inc., 292 S.C. 426, 357 S.E.2d 15 (1987). The Supreme Court narrows the important parts of a closing into several main areas: title search, loan documents, closing, recording documents, and disbursing the closing funds. In South Carolina, each of these steps require a licensed attorney.
The role of the attorney in a real estate transaction is as follows:
- Contract Review: Review the executed contract, and make sure the buyer or seller is aware of all that they are legally obligated to throughout the transaction (i.e. escrow deposits, surveys, inspections, title searches, property disclosures, homeowners association requirements and fees, financing contingencies, etc.).
For a buyer getting a loan, the attorney works with the lender to ensure that all appropriate loan documents surrounding the real estate transaction are prepared, that the necessary inspection reports are ordered and reviewed, and that a title search is ordered.
For a seller, the attorney must make sure that any mortgages or liens on the property are noted, that the necessary inspection reports are ordered and reviewed, and that any homeowner association documentation/fees are received and reviewed.
- Title Search Documents: Review the title documents produced from the title search. In South Carolina, a title search may look at the chain of title as far back as 60 years to assure that all mortgages, judgments, liens, etc. have been satisfied, and that any easements or defects in the title are brought to light. It is imperative that clear title be established in order for the property to convey from the seller to the buyer.
- Title Insurance Policy: Once the title search has been completed, and clear title to the property has been established, the title insurance policy can be ordered. This policy protects a buyer from any judgments or liens that may not have surfaced during the title search.
- Closing Documents: As the closing day nears, the attorney must assure that all necessary closing documents (i.e. loan documents, settlement statements, closing disclosures, deed, etc.) are prepared and ready to be signed by the buyer or seller.
- Closing Day: During the closing, the attorney must review the settlement statement and various other closing documents with the buyer or seller, and have the documents signed, witnessed and notarized.
- Recording: Once the buyer or seller signs the closing documents, they must be sent over to the courthouse for recording with the Register of Deeds.
- Disbursement of Funds: After all necessary closing documents have been recorded, the attorney must make sure that all the funds involved in the transaction are properly disbursed (i.e. lender fees, attorney fees, real estate agent commissions, inspection fees, homeowner’s association fees, courthouse recording fees, mortgage payoff and satisfaction fees, etc).
It is important when selecting an attorney to handle your South Carolina real estate transaction that you choose wisely. It’s never a bad idea to ask for a recommendation from friends, family members, colleagues, bankers, or even the county bar association.
Ashley Welch Melton is a Real Estate Attorney at Feldman & Melton Law Offices, LLC. Ashley grew up in Murrells Inlet, South Carolina, and is married to Myrtle Beach native, Duke Melton. They have three children (Jaxson, Carson, and Ellison) and LOVES boating, eating out, traveling, and taking care of their two cats; Slate and Luna.