Question

Preparing documents or escrow provisions that go beyond the customary duties of an escrow officer:?

1) should be done only by a licensed escrow officer
2) may constitute the unlawful practice of law
3) should only be done with specific written instructions
4) does not present a hazard to the transaction

Answer 1

Preparing documents or escrow provisions that extend beyond standard escrow officer duties could lead to unlawful practice of law if not handled by a licensed professional, and must be guided by specific written instructions.

Step-by-step explanation:

When preparing documents or escrow provisions that go beyond the customary duties of an escrow officer, it's important to understand that such actions:

1. May constitute the unlawful practice of law, as escrow officers are typically not attorneys and thus are not authorized to draft legal documents or give legal advice.
2. Should only be done with specific written instructions to ensure that all parties are clear about the terms and conditions involved.
3. Should be done only by a licensed escrow officer who is properly trained and authorized to handle such matters.

Escrow is used during the home-buying process to ensure that property taxes and home insurance are paid as part of the normal monthly payment, but extra duties should be approached with caution to avoid legal issues.