While remote notarizations became legal Jan. 1, existing notaries must register with the state in order to perform online notary services, and some mortgage lenders may still require in-the-room signatures. By the end of 2020, 36 states will have e-notary laws, remote notary laws or both.
While vacation-home purchasers living in Ohio now have the legal ability to close from their Cleveland home thanks to a Jan. 1 Florida law that allows for remote notarization, that law doesn’t demand that remote notaries be accepted.
As a result, lenders can refuse to accept remote notarizations, and buyers securing a loan through one of these companies must be present at closing.
In addition, Florida notaries must register with the state as an online notary, in addition to posting a $25,000 bond, having $25,000 of errors and omissions (E&O) insurance and completing a two-hour course. They must also have the designation of a remote online notary provider, which acts as the digital liaison between remote buyers and sellers in the transaction. Not all notaries have done so yet, and some may decide they don’t want to take these additional steps.
Still, “if the Florida notary has remote notarization authority, then the buyer and seller could be almost anywhere,” says Meredith Caruso, associate general counsel for Florida Realtors. “It appears that all parties, as well as the lender, have to consent to use RON (remote online notary) to make the system work, so if the lender says ‘no,’ then it isn’t an option.”
Florida, Idaho, Kentucky and Oklahoma e-notary laws went into effect on Jan. 1, and DocVerify Chief Technology Officer Darcy Mayer says as many as 12 other states could consider e-notary or remote notary laws in 2020.
“As it currently stands, by the end of 2020, 36 states will have e-notary laws, remote notary laws or both,” says Mayer. “Public demand is being fueled by the security, cost savings, convenience and efficiency these services offer, and state lawmakers are responding.”
E-notaries electronically affix signatures and notary seals to an electronic document such as a PDF or Word document. The document is then instantly and securely transmittable. Remote notaries are authorized to provide a similar service to parties in separate locations via the internet, using digital tools and a live audio/video connection versus electronic notary, where physical presence is required by law.
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