We should not adopt a rule that would make it more costly and difficult to buy a home. The proposed opinion would require consumers to use a lawyer for settlement when they buy and sell property, when they refinance their mortgages, or when they get a home equity loan. The Kentucky Bar Association's Board of Governors will consider the proposed opinion at its Friday, September 12 meeting. The opinion, proposed by the Kentucky Bar Association's Page 2 Unauthorized Practice Committee, must be approved by the Board of Governors and Kentucky Supreme Court to be binding. Currently, Kentuckians can use a non-lawyer settlement service, such as a bank, title company, or realtor.
Many banks provide closings services for refinancings and home equity loans at no additional cost.
Klein said that the opinion would raise prices in two ways. First, it would force Kentuckians who would prefer not to pay for a lawyer at closing to do so. The Kentucky proposal would overturn a 1981 state opinion which held that non-lawyers could provide settlement services. Since this opinion was issued, non-lawyer services have increasingly offered closing services in northern Kentucky, Louisville, Lexington, and other parts of the state. Consumers may be less likely to have legal questions at closing today than in the past because increasingly standardized forms are used for mortgages, the Department said.