What a Commercial Mortgage Broker Must Do at Closing

Many commercial mortgage brokers think that there's nothing for them to do at closing, except pick up a check. Not so. Aside from trying to be pleasant and staying out of the way, brokers must examine a critical document or two to make sure their interests are protected.

“Your role in this process is that of a bridegroom at a wedding: stay out of the way, be on time, and keep your mouth shut.” —Tom C. Korologos, U.S. Ambassador to Belgium, describing the advice he gives to presidential nominees. Quoted in the New York Times, September 4, 2005.

A commercial mortgage broker’s duties at the closing table are, most of the time, much like the role of a presidential nominee. If you’re feeling almost expendable as you sit at the closing table, if you’re being treated as unessential baggage, that’s because, unlike everyone else, you’ve gotten almost all of your work out of the way beforehand. Congratulations! On the other hand, if you're very busy and important at close, that's not a good sign for anyone! That means that there are a lot of loose ends to tie up.

So let's say your closing is going well--extremely well. There are still a few critical things left for you to do.

First, as Ambassador Korologos advises, show up on time (more or less…). Try not to spill coffee on yourself along the way, and bring a copy of your invoice and of your engagement letter with you (in case there is some unclarity with regard to your fee). Then turn off you cell phone, be pleasant, stay out of the way and give up your seat to the elderly, pregnant or disabled and any legal type person who needs your space.

And try not to fall asleep because at some point, a settlement sheet will be passed around for various dignitaries to sign—you’re not one of them. Nonetheless, you must ask to see it, and you must inspect it carefully to make sure that your company’s name is on it and that the amount to be credited to you at closing matches your invoice. Look for your front and back end points, if applicable. These appear on different places on the statement. If the numbers are off, ask the lender’s attorney for an immediate correction.

That’s really the only semi-technical task you should be doing at the closing table. Of course, if the closing “blows up” in your face, you might end up dealing with any number of issues, including negotiating with the title company, the lender, attorneys on either side, and of course, your own client. In situations like these, of course, you could end up dealing with anything you didn’t adequately resolve before the closing.

Mark Yoffe is the president of MarCapital Inc., a commercial mortgage brokerage firm. His practice specializes in bridge loans and in complex commercial transactions in addition to more conventional commercial mortgaged backed securities deals. Mark works closely with accountants, brokers, and real estate attorneys and other professionals in an effort to structure highly competitive and tax-advantageous transactions for his clients. In addition to handling his own caseload, Mr. Yoffe personally oversees the firm’s continuing education program and is a distinguished and sought-after guest speaker at many notable real estate institutions. Mr. Yoffe’s articles have been published in the New York Real Estate Weekly and the Commercial Mortgage Insight, among other publications. Mark lives with his girlfriend in Manhattan and can be reached at yoffem@hotmail.com (mailto:yoffem@hotmail.com).

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