Do you need a real estate attorney to close in Kansas?

What the law requires

I searched the Kansas statutes on brokers, title insurance and closings and found no sentence saying a buyer or seller must use an attorney. I also read no Kansas court rule or opinion on the point, so I do not state that a ban or a mandate exists beyond what the statutes say. The Kansas Insurance Department regulates title insurance agencies, whose law aims to regulate “title insurance agencies engaged in settlement and closing of the sale of an interest in real estate” (K.S.A. 40-1135).

Who conducts the closing

Kansas law lets a title insurance agent handle the closing. A “title insurance agent” is a person who, for a title insurer, does any of these acts: determines insurability and issues policies, collects or disburses funds, handles escrow, settlements or closings, or records closing documents (K.S.A. 40-1136(e)). Safeguards in the statute include:

• Funds go into a separate fiduciary trust account at a qualified financial institution by the close of the next business day.
• Funds are disbursed only on written authorization of buyer and seller, by court order, or when the deal closes under the parties’ agreement.
• The agent may not mix personal money with escrow funds.
• Closing funds above $2,500 must be in one of the forms the statute lists, such as U.S. currency, wire transfers unconditionally received or cashier’s checks.
• Each agent must have an annual audit of its escrow accounts by a certified public accountant or a title insurer it works with. Attorneys who issue policies as part of legal representation are exempt from the audit requirement (K.S.A. 40-1137(d)).

The statute also refers to attorneys who act as title insurance agents. It exempts them from the audit requirement only when they issue policies as part of legal representation, and not when they are exclusively in the title insurance business.

What a closing costs

The statutes I read set no fee for closing services, and I found no official source that gives a typical attorney fee in Kansas. Closing fees and attorney fees are set by the business or lawyer you hire, so get written quotes. The federal Loan Estimate and Closing Disclosure show which fees your lender requires; see closing costs explained and Kansas closing costs.

Do agents give legal advice?

No. Kansas licensees must advise clients and parties to get expert advice on material matters outside their expertise (K.S.A. 58-30,106(a)(2)(C); K.S.A. 58-30,113(b)(2)(B)). An agent who recommends an expert is not liable for that matter (K.S.A. 58-30,106(b)). Your agent is not your lawyer.

When an attorney is worth it anyway

An attorney is not required, but consider one when:

• Title problems appear. The title search shows liens, boundary disputes or unclear ownership; see title insurance explained.
• The contract is unusual. You are changing deadlines, adding contingencies or buying without an agent. A seller who sells without an agent is outside the disclosure duties in the license act; see Kansas seller disclosure.
• You face foreclosure. Deadlines to answer the lawsuit and to redeem are short (21 days to answer, generally 12 months to redeem; K.S.A. 60-2414). See Kansas foreclosure.
• Estates, divorce or trusts are involved in the sale.

Ask your state bar association or a legal aid office about low-cost help if cost is a concern. For the closing in Johnson County, see Overland Park.