If you’re buying or selling a home in Georgia, you’re required to close with a licensed Georgia attorney. But many people are surprised to learn whose interests the closing attorney represents in a financed transaction and how that affects buyers, sellers, and lenders.
Because Georgia is an attorney-closing state, the closing attorney’s role is not simply clerical. It includes legal responsibilities such as examining title, preparing documents, ensuring compliance with lender instructions, supervising the transfer of property, and disbursing funds. And importantly, in nearly every financed residential transaction:
The closing attorney is required to represent the lender and must follow the lender’s written instructions.
That single fact explains most of the attorney’s responsibilities during a closing. The lender expects the closing to result in a enforceable indebtedness secured by a home with good title.
This article explains what that means, how dual representation works in Georgia, what duties the closing attorney owes to buyers and sellers, and in what cases separate legal counsel may be needed.
Why the Closing Attorney Represents the Lender
In a financed closing, the lender is providing the funds, and the lender’s interest in the property must be legally protected. For that reason:
- Georgia law requires attorney involvement, and
- The lender requires the closing attorney to serve as its legal representative.
The lender provides detailed closing instructions, and the attorney must:
- Draft and/or review and record the lender’s security deed
- Verify the title meets lender requirements
- Assist the lender in satisfying federal and state disclosure laws
- Prepare the settlement statement
- Ensure all lender conditions are satisfied
- Refuse to proceed if instructions aren’t met
These duties are not optional – they’re part of the attorney’s ethical and contractual obligations. If the lender is not secure in proceeding, it will not contribute its funds to make the transaction happen.
Dual Representation: Helping the Buyer and Seller While Representing the Lender
Even though the closing attorney must represent the lender first, Georgia law allows the attorney to work with buyers and sellers in a neutral, limited capacity—as long as no conflict of interest exists. Thankfully, in most residential transactions, this is not a problem.
Dual representation means:
- The lender is the attorney’s client, and the attorney must follow lender instructions.
- The attorney must still treat the buyer and seller fairly and honestly.
- The attorney cannot give individualized legal advice that favors one party over the lender.
The closing attorney is essentially a neutral facilitator for the buyer and seller, but a legal representative for the lender.
A Key Duty: Accurately Disclosing the State of Title to the Buyer (Unless Waived)
One of the attorney’s most important responsibilities is performing the title examination. After reviewing the history of the property, the attorney must, unless this duty is waived, give the buyer (along with the lender) accurate information about:
- Liens
- Encumbrances
- Easements
- Covenants
- Access issues
- Title defects or clouds on title
This duty exists even though the attorney represents the lender. The buyer must have enough information to make an informed decision about moving forward.
Assisting the Seller: What the Closing Attorney Can Prepare
Although the attorney represents the lender, the attorney often may assist the seller with transaction-related documentation, such as:
- Corporate resolutions for LLCs or corporations selling property
- Trustee certifications for trust-owned property
- Estate or probate documents needed to establish authority to convey property
- Seller affidavits required by the lender
- Obtaining loan payoffs
- Preparing a power of attorney, where necessary and acceptable
These tasks ensure the seller’s authority to transfer title is properly documented. The Seller is always welcome to employ another attorney to handle these tasks, but it’s often most efficient to engage the closing attorney to handle these items which are necessary for the transaction to occur, therefore benefiting all parties.
But again, the attorney cannot give the seller personal, strategic advice if doing so would conflict with the lender’s interests or compromise the attorney’s neutrality.
When Conflicts of Interest Arise
Because the attorney must follow lender instructions and maintain fairness to buyer and seller, conflicts can arise in situations such as:
- 1. Contract Disputes Between Buyer and SellerRepairs, earnest money, interpretation of contingencies, or inspection issues place the parties at odds. The attorney cannot take either side, and we often refer parties to their realtors to attempt to resolve these types of issue.
- 2. Title Problems With Real Consequences to One PartyIf the title issue burdens one party more than another, the attorney must disclose the issue but cannot become involved in aggressive negotiation over a resolution.
- 3. Buyer or Seller Requests That Contradict Lender InstructionsIf a party wants to waive or alter something the lender requires, the attorney must follow the lender, not the buyer or seller.
- 4. Undisclosed Side AgreementsIf the buyer and seller make private agreements – extra payments, repair deals, or other concessions not shown on the settlement statement – the attorney must refuse to participate. Lender instructions, especially on FHA and VA loan, typically forbid undisclosed credits or concessions at closing.
What the Closing Attorney Can Do for All Parties
Within the boundaries of representation and ethics, a Georgia closing attorney can:
- Explain documents neutrally
- Provide accurate title information
- Prepare deeds and affidavits
- Facilitate communication among everyone involved
- Ensure lender compliance
- Resolve clerical and procedural issues
- Record documents correctly
- Disburse funds securely
These are essential services that help the transaction close smoothly and legally.
When a Buyer or Seller Should Have Their Own Attorney
Separate counsel is helpful when:
- The parties come into the transaction in a contentious posture
- The contract is complex or involves non-standard terms
- Boundary line or survey issues exist
- Significant title defects require negotiation
- One party needs specific advice on risks, liability, or strategy
- A conflict arises that the closing attorney cannot resolve
An individual attorney can advocate for a buyer’s or seller’s interests without restriction.
Our Firm’s Role in Georgia Closings
At Bryant & O’Connor, we take our responsibilities seriously:
- If there’s a loan, we represent the lender and must follow the lender’s written instructions.
- We treat buyers and sellers fairly and provide accurate title information and handle all funds carefully.
- We remain neutral in disputes and cannot give one-sided legal advice when we are being trusted by multiple parties.
- We guide all parties through the closing process with clear communication and professionalism.
Our goal is to ensure a smooth, transparent, and legally compliant closing every time.
Disclaimer
This article is for general informational purposes only and is not legal, financial, or real estate advice. Every situation is different. You should consult a qualified professional for guidance tailored to your circumstances.