Are you being pressured to give opinions, and to assume responsibility, outside of your area of expertise by lender instructions in residential real-estate transactions?
The CBA’s Real Property Section has just updated its Mortgage Instruction Toolkit for the second time this year, with new sections on scope of work obligations, lender intermediaries, property taxes, requests for undertaking, and more.
“When responding to requests, limit the scope of your legal services to matters within your expertise.,” the toolkit advises. “Restrict opinions to matters of law where you have conducted appropriate due diligence, and do not give opinions on questions of fact. When a request falls outside your expertise, provide the lender with applicable third party information, identifying the source. Avoid any implication that you have expertise in the matter.”
The Mortgage Instructions Toolkit offers practical guidance for lawyers responding to lender requests. For example, the new section on zoning explains the two aspects of zoning you need to worry about – compliance with lot and building requirements, and compliance with applicable zoning bylaws – and how they’re usually addressed. It then provides a sample of lending instructions, and how to comply with those instructions based on whether the transaction is covered by title insurance.
The Section invites lawyers to contact them at cbarealproperty@cba.org if there are issues and topics they are facing with lender instructions that they would like to see in the toolkit.