Why Delaware settlements use an attorney, and what happens at settlement

In 2000 the Delaware Supreme Court approved a decision of its Board on the Unauthorized Practice of Law (Matter of Mid-Atlantic Settlement Services, Inc.). The Court affirmed that:

• an attorney licensed to practice law in Delaware is required to conduct the closing of a sale of Delaware real property, and of a refinance secured by it,
• a Delaware attorney must be involved, directly or as a supervisor, in drafting or reviewing the documents that transfer title,
• a Delaware attorney’s participation is needed to evaluate the parties’ legal rights, represent the buyer in examining the title and clearing title problems, supervise the money, and answer questions about the legal effect of the documents.

That is why every Delaware home purchase has a settlement attorney.

• Title work. The office orders and reviews the title search, looks for liens, open mortgages or other problems, and works to clear them before settlement.
• Title insurance. The office arranges the lender’s policy and, if you choose, an owner’s policy.
• Documents. It prepares or reviews the deed and the settlement papers, and works with your lender on the loan documents.
• The numbers. It prepares the settlement figures, including the realty transfer tax. See the Delaware transfer tax guide.

Ask the office at the start whom it represents and what its fee includes. Fees vary, so it is worth asking for a quote. See what buyers pay at closing.

1. Keep your loan steady. Don’t open new credit or change jobs without talking to your lender.
2. Read the Closing Disclosure. Your lender must give it to you at least three business days before you close. Compare it with your Loan Estimate.
3. Confirm wiring instructions by phone. Call the settlement office at a number you already trust before you send money. Wire fraud often starts with a fake email.
4. Do the final walk-through. We visit the home with you shortly before settlement to check that it is in the condition the Agreement of Sale requires.
5. Bring a photo ID and anything else the office asks for.

Settlement usually takes place at the attorney’s office. The attorney or a member of the team walks you through each document:

• the settlement statement, which shows every cost and credit,
• your loan papers, including the note and the mortgage,
• the transfer tax paperwork, and the first-time buyer schedule if you qualify.

The seller signs the deed, sometimes on a different day or by mail. After everything is signed and the lender releases the loan funds, the attorney’s office supervises paying out the money: the seller’s payoff, the taxes, the fees and the seller’s proceeds. The deed and your mortgage are then recorded in the county land records. Keys are handed over as your Agreement of Sale provides.

Sometimes. Some settlement offices can arrange for a buyer or seller who can’t attend to sign ahead of time, depending on the lender’s rules. Ask the office as early as you can. Talk to your settlement attorney, lender or tax advisor about your own situation.