What is the term for a legal document that gives authority to another person to act on one’s behalf in real estate transactions?

The correct answer is power of attorney. This legal document allows one person, known as the principal, to designate another person, the agent or attorney-in-fact, to act on their behalf. In real estate transactions, this might include signing documents, making decisions, and executing agreements related to buying, selling, or managing property. The power of attorney grants the agent the authority to make decisions as if they were the principal, which can be particularly useful when the principal is unavailable to manage their affairs directly.

The other options do not encapsulate the same legal authority. A real estate agreement typically refers to a contract between parties concerning the exchange of property but does not specifically provide authority to one party to act on behalf of another. Agent authorization may be used informally to describe permissions given to agents, but it lacks the legal standing and specific framework that power of attorney provides. Similarly, a contract of agency outlines the relationship between the principal and the agent but does not serve as a document granting the agent the authority to act in the same way that a power of attorney does.