Title company wants to see my Articles of Organization, etc.

[Micah Livengood]

My Father and I are part of an LLC through our real estate investing business. We are buying a property for $15,000.00 cash. I got an email from our lawyer we use typically to close on a cash and or contract deals.

The Title company would like to see my certificate of existence, and possibly articles of organization and our operating agreement.  My lawyer suggest we see what the title commitment shows to see if the title clears. 

Why would they need to see this?

[J Scott]

There is a very simple reason they need to see these things...

Just like if a person were to buy the property, they would need to see proof that the person is who they say they are so that the signatures are legal.  Likewise, if a company is purchasing the property, they need to verify that the company really exists (so that it's a legal purchase), and they need to verify that the person who is signing the documents has the legal authority to do so (that's what should be in your operating agreement).

For example, what if I were to try to purchase a property in your company's name.  Without a copy of the Operating Agreement, how does the title company know that I'm not allowed to sign on a $15K purchase for your company.

Or perhaps you have a partner, and your operating agreement states that for any contract over $10K, it needs all partners signatures on the closing docs.  Without the Operating Agreement, they wouldn't know this, and they might let you sign without your partner -- that would be against your corporate policies.

Another example - my Operating Agreement with my partner states that for any purchases of real property under $250K, either of us can sign by ourselves.  For any purchase over $250K, we both have to sign.  I'd be really pissed if the title company allowed him to sign for a purchase of $500K when our company policy (as stated in the Operating Agreement) says that's not allowed.