MortgageReal Estate

North Carolina officially completes first-ever eClosing

North State Bank plans to make eClosing new standard in state

North Carolina passed a major milestone in the housing finance industry this month, performing its first ever eClosing.

The state, along with North State Bank and the help of other key parties, executed a 100% electronic mortgage closing. Investors Title Insurance Company of Chapel Hill insured the electronic, notarized mortgage, while DocMagic and World Wide Notary were the electronic solution providers that were used.

“This was our first North Carolina eClosing,” N.C. Secretary of State Elaine Marshall said, “It is not our last. We want this to become a regular option for lenders and their customers because of the many advantages eClosing offers versus the slower, traditional paper-based system.”

Tim Anderson, director of eServices with DocMagic, explained that the announcement is important since North State Bank plans to push this way as their default and not the exception.

Up until this point, Anderson stated the majority of eClosings have been a Proof of Concept (POC) to “test” one or two, and most did not pursue an eClosing as their standard way of doing business going forward.

Anderson added that the state being North Carolina is significant since it’s an attorney state where they usually get a lot of push back, and their eNotary law is more stringent as to what must be done to be legally credentialed to be an eNotary.

Despite that, Marshall hopes to make eClosings the new normal and advocates for modernizing traditional business practices in North Carolina to better compete at the national and international levels.

“The eNotary is essential to moving legal filings into the digital age,” Secretary Marshall said. “People and institutions still want to know that a notary was there in the room confirming the signer’s identity even if the filing is moving through cyberspace instead of being a pile of paper.”

Marshall stressed that eClosings have all of the regular features and safeguards that people see when they execute a mortgage on paper. “For eClosings we require the physical presence of that notary plus the access to legal expertise—there is zero drop in standards for an eClosing—it is just faster, far more convenient and in my opinion more secure,” said Marshall.

This news marks a major event in history for North Carolina, but it’s not the first-ever eClosing. In 2016, Radius Financial Group partnered with DocMagic, the MERS loan registry, Fannie Mae and Santander Bank to complete the long-anticipated eMortgage. The group closed six loans in a completely paperless process, utilizing both lender and closing/settlement agent documentation, eNotarization, eWarehousing and eNote acceptance through DocMagic’s eClosing solution.

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