Health concerns have created disruption in title business practices and are forcing changes to real estate closings in 2020. As the ‘new normal’ continues to evolve, title companies are adapting in their own ways, each at a different pace. Some have quickly embraced changes required for social distancing while others are taking a little longer to adjust.
As we are working to keep business flowing and reach the common goal of completing transactions, sometimes the solutions are not as simple as they might sound. Let’s take a look at the different ways you may be signing closing documents in May 2020 and beyond.
Remote Ink-Signed Notarizations (RIN)
This was approved by Gov. Abbott on April 27 via emergency executive action for temporary use under COVID-19 public health protocols. It is in effect until the earlier of May 30, 2020, or the termination of his disaster declaration.
These temporary RIN protocols allow for the remote visual witnessing of ‘wet’ signatures by a notary. Basically, the notary witnesses the signing via video and then obtains the original documents from the signer. The state has issued very strict policies which could make this type of signing a lengthy process.
Some of the rules for using this temporary Remote Ink-Signed Notarization include:
- Full disclosure and approval in advance from all parties – buyer, seller, lender and title company.
- Paper documents must first be delivered to the signatory and when the signing is completed, those original documents must be delivered back to the notary and title company prior to funding.
- The signatory must appear on a two-way, recorded video conference with the notary.
- The signatory must provide a copy of the front and back of their driver’s license or passport to the notary in advance and again when signing.
- The signatory and notary must both be located in Texas.
- Each signatory must speak the name of each document they are signing and then sign it within clear view of the camera. The camera must be angled so that the notary can clearly witness the document being signed (pen to paper).
There are also technical considerations to consider with a RIN. The suitability, effectiveness, and security of the audio-video communication system should be evaluated. The recording device and internet connection used by the signatories must be able to relay video of suitable quality. Network and privacy issues required for an uninterrupted video recording should be worked out in advance. Keep in mind that title companies will not waive requirements that are required by law or by their underwriter.
Traditional Signing at Title Company With Limited Contact
You may be asked to wear a mask to closing, and expect the closer to give you the same courtesy of wearing a mask. Many companies are spacing out their closing appointments to allow time to clean the closing rooms between transactions and to avoid people waiting in their lobby areas. Title companies are commonly restricting additional guests (agents, lenders, family) from closings. Realtors and lenders may be remotely conferenced in by phone or video to answer questions from their buyers or sellers.
Customers can help by avoiding scheduling their closings on days that are traditionally the busiest, which are Fridays, the last day of the month or the eve of a holiday.
Curbside Closing
This is like a traditional closing, but you stay in your vehicle at the title company location. The escrow officer passes you papers and witnesses you signing. These may decrease as the summer heats up in Texas. For details on this option, see this recent story on drive-through closings.
Mobile Notary at Your Location
The escrow officer or mobile notary comes to your home or office to sign documents with you. These are very popular, so be flexible and expect to work around the notary’s schedule. The additional cost to the signer varies and often runs $150 to $300.
Unlike an escrow officer, the mobile notary is typically not allowed to explain any documents. They confirm your identity, ensure all documents are signed, and witness your signature. Original, signed documents must be in the title company’s possession before the transaction can be completed and funded, so they are normally scheduled a day or two prior to the closing date.
Remote Online Notarization (RON)
This ‘e-closing’ option is still new in Texas. Most lenders and financial providers are not yet allowing its use for transferring real estate in Texas. There are strict rules as to its use.
It must be set up in advance and approved by all parties – buyer, seller, lender, and title company. The signing parties must pass a Credential Analysis and Identity Proofing. This requires the signer to answer a timed quiz of at least five questions related to their personal history or identity.
All parties involved must use a two-way video and audio system that meets the criteria. There is an additional cost and not everyone will qualify to use this system.
While a RON might seem like a RIN, it’s really its ugly cousin. The signing is conducted electronically and signatures are not ‘wet’ ink pen to paper. These digital signatures have not yet been embraced throughout the industry.
As title companies rethink the way they conduct business in 2020, some resolutions are taking us into uncharted territory. Many savvy companies are cautious about adopting them without some trial. But they appear to be trying.
The opinions expressed are of the individual author for informational purposes only and not for the purpose of providing legal advice. Contact an attorney for any particular issue or problem.
