Online Closings – A Guide for Mortgage Lenders and Title Agents
Let’s face it – in the case of refinances or home equity loans, borrowers want their money ASAP. The same goes for new home purchases. Borrowers can’t wait to move into their dream home. Going to an office to sign documents, while today and historically a necessary step, is seen as an inconvenience for something that borrowers just want to happen NOW. These issues are reduced through a new way of closing – online (aka remote) notarization! The borrower does not have to travel to an office or invite a stranger into his or her home to sign documents in order to close their transaction. Of course, online notaries may have their own issues (computer or webcam not working), yet these issues can be greatly reduced with communication, risk-management strategies, and cooperation between the parties involved.
Today, online notarization is only allowed and insurable in a limited number of states where the law recognizes the lien of the security instrument as valid and enforceable with priority. However, we see this trend growing quickly due to consumer demand for convenience and lender interest in efficiency.
Lenders and title companies should proceed carefully in states that allow online or remote eNotarization while also considering how tools and technology can enhance the closing experience for clients and customers to make business better.
To read more about the issues surrounding online notarization read Stewart’s new white paper – “Online Closings – A Guide for Mortgage Lenders and Title Agents.”