Real estate closings and remote online notarization in 2020. How real estate professionals are finalizing closings during the COVID-19 pandemic.
As a follow up to a recent story on online notaries and remote online notarization, we received several letters and have some more information for our readers.
Comment: I understand the need for online notaries. However, I would like to note that my attorney for my refi came to my house and we finalized the documents on a card table in my garage (I am 75). We were going to use my porch but it was very windy that day. My attorney said that there was a way in Connecticut to accomplish a signature online. He told me that it was easier for him to drive to my home and have me sign the documents in front of him. My son in Seattle closed on a table in his front hallway with a notary. So, there are other ways to safely finalize closings without online notaries.
Comment: My closing was early April and while I e-signed most documents, a notary was necessary for about 12 of the documents. Because of the coronavirus, my bank was unable to provide a notary. My son reminded me that UPS stores all have notaries. You just have to call ahead to confirm.
Real Estate Closings and Remote Online Notarization in 2020
We recently focused on how the COVID-19 virus was starting to change the way real estate transactions are handled. In particular, some settlement agents were taking advantage of remote online notarization systems to limit the number of people at a real estate closing.
It won’t surprise anyone to learn that the real estate community in different parts of the country are handling the COVID pandemic in a variety of ways. On the one hand, you have traditional document signings with traditional notaries. In these situations, the person signing the paper documents signs them before a notary and the notary acknowledges the signing with the notary’s signature and stamp. These are also known as “wet” signatures.
The traditional notary system still works and works well for most real estate transactions. However, as the COVID pandemic has spread over the past two months, buyers and sellers (and real estate professionals involved in the transaction) are looking for ways to avoid contact with others, which is why the option of remote online notarization is growing quickly.
And, yes, UPS stores, currency exchanges, many banks, many attorneys and accountants, and even some property managers can notarize documents for you. Before Covid-19, the bank or lender might come to your home and have you sign all of the documents you might need for refinancing. The lender would also bring a notary to notarize the documents. It was convenient for the borrower and a pretty efficient system.
How Remote Online Notarization Works
Unfortunately, the new social distancing rules (and our own innate sense of preservation) has translated into finding other ways of doing business. You may be unable to find a lender or notary who is willing to make a house call. So, while that system can still work, if the professionals in your transaction are unwilling to be in close contact, you might have to find an alternative method to get your refinancing documents signed.
This is where remote online notarization can be quite handy. Just as the lender or notary came to your home, you can sign the refinance documents in your home while an online notary watches you and sees you sign the documents. One of the drawbacks to this system is making sure that the person signing the documents has enough knowledge of their computers and of web-based programs to use the online notary system.
These days it’s pretty common to hear of parents or grandparents asking their tech-savvy kids or grandkids how to use Zoom, Microsoft Teams or other conferencing software systems. For online notary systems to work, the person signing the documents has to feel comfortable with the signing process.
What You’ll Need for Remote Online Notarization
If you plan to use an online notary, you’ll need a computer with a camera and microphone. You’ll need to make sure you know how to turn on the camera and microphone as well as understand the program used by the online notary that allows you to view the documents, watch you sign the documents, talk to you, and record the interaction. You will also need reliable internet service.
Sometimes it’s just easier to do something in person if someone might have technology issues. We suspect that our first reader signed the refinancing documents before the coronavirus quarantine. These days most settlement agents and title companies will try to limit the number of people that come to closings, or have buyers and sellers sign documents through their car window (with new pens) or if the closing can be done remotely, the settlement agent may try to push all parties to get the deal done that way.
Thank you for your comments and letters. We really appreciate hearing from our readers.