Your Most Up-to-Date E-Closing Information Here!
In the ever-evolving world of E-Closings and Remote notary options, join Two Rivers Title’s Stephanie Benedetto, EVP of Operations, and CEO, Matthew Cohen for up-to-the-moment answers in this video Q&A from May 20, 2020. Read on for more important information about Eclosing.
Navigating E-Closing Information: Fact or Fiction?
Q: Who are the players involved in E-Closings and E-Notary? Who must approve?
A: First, it depends on the State. Notarization laws are currently determined on a State by State basis, although there is federal legislation pending in Congress which may set a national standard. In New Jersey, we have temporary legislation which ends with the termination of Governor Murphy’s emergency order. The meaning of the legislation is still being debated. For now, at least in New Jersey, Lenders, Settlement companies, Title Underwriters and County Clerks all have some say in what type of E-process they find acceptable and ultimately, must work in alignment. Lenders, who must ensure the salability of loans, will have the loudest voice, and choose the platforms and circumstances that work best within their organizations. Similarly, in conjunction with state legislation, they decide which forms of notarization they will allow.
Q: Should I suggest that all my clients use RON if they have Facetime on their phones?
No. It is not quite as simple as that for 2 reasons. First, Facetime or Skype do not adequately confirm identities. Simply holding up a driver’s license to a camera is not sufficient. Instead proper credential analysis or Knowledge Based Authentication, a series of unique, personal questions designed for only the signer to know the answer to must be conducted. In addition, Facetime cannot properly record the signing. A video of the closing must be kept for 10 years (or as determined by each state) and in some cases, the life of the loan and must be made available to the Lender.
Identity proofing – process or service provided by a third party that enables a notary to verify the identity of a remotely located individual by a review of personal information from public and private data sources, such as:
- Knowledge-based authentication (KBA) – whereby an individual must answer 4 or 5 dynamic personal questions correctly within a short period of time, the answers to which can be ascertained from public or private data sources
- Credential Analysis – whereby characteristics and security features of an individual’s identification document (i.e., “credential”) is remotely analyzed
- Password or Biometric Identification – whereby an individual’s identity is verified by production of confidential password or analysis of unique biometric trait (e.g., fingerprint, facial characteristic, voiceprint)
Q: What is the difference between RIN and RON?
A: R.O.N. stands for Remote Online Notarization and refers to a process whereby the entire closing is conducted electronically. The closing package is signed with digital signatures, while the notary witnesses and records the closing and the signing, using a specialized system such as Pavaso or Notarize, that authenticates the signers ID and retains the audiovisual communication.
RIN, conversely, stands for Remote Ink Notarization. In this practice, the notary uses the same audiovisual communication to verify ID’s, then watch while the borrower signs the required closing documents using a regular pen. The package of documents is then sent to the Notary who adds his/her ink signature, to the paperwork previously witnessed by audiovisual means.
Q: What is a Hybrid closing?
A: Many lenders are choosing hybrid closings.
50% or more of the mortgage package is sent electronically to the borrower who can review and sign the documents using tools such as DocuSign. Then, documents that require a notary are signed physically in front of a notary who apply their ink signatures where applicable.
Q: What does a “wet signature” mean?
A: Most Lenders currently require a wet or actual ink signature on documents that require a notary, such as the Mortgage and the Note.
Q: While Lenders are becoming comfortable with R.O.N., in the states where it is allowed, are there other situations where R.O.N. can be used now?
A: Yes. R.O.N. is an excellent choice for the remote signing of Seller’s documents and for cash purchases.
Q: Why is it important for a settlement company to be RON READY?
A: According to the American Land Title Association, due to the pandemic, thousands of mortgages are being closed online for maximum consumer safety.
As a result, RON is in high demand and lenders are actively looking for title and settlement companies that can close their loans using this technology and use it correctly. Correctly is the operative word to protect the identities of the parties and the validity of the transaction.
E-Closings: The Ultimate Customer Experience
“When borrowers can preview the whole closing package ahead of the signing event, they feel higher levels of feeling informed and empowered. eClosing also reduces the amount of time at the signing table and unnecessary delays, resulting in increased customer satisfaction.”
Two Rivers Title is certified and R.O.N. READY and R.I.N. Ready!
It is our pleasure to be Your Closing Partner, no matter what type of closing you choose.
Matthew Cohen Esq., CEO
Two Rivers Title Company LLC