Remote online notarization is spreading like wildfire across the U.S. as COVID-19 and stay-at-home orders forced many companies and mortgage notaries to look for alternative methods to continue operating amid the socially distanced environment in 2020. But what is in store as 2021 unfolds?
Consumer demand for RON only continues to grow. Currently all states but two (California and South Carolina) have accepted some kind of RON or remote ink-signed notarization methods, either through temporary COVID-19 emergency orders or permanent state legislation.
Earlier this year, Notarize and Realogy Title Group announced they saw a 200% spike in RON closings in the first half of 2020, as compared to the full year in 2019.
So what does all this change mean for mortgage notaries? Is their job on the line, will RON bring a fundamental change to how their job is performed or will it be used as simply another tool that makes their job easier?
One HousingWire reader, who is a retired mortgage banker of more than 40 years and a certified signing agent, fears RON will turn notaries into call centers to be called on by lenders.
“I found that few title companies or lenders were ready to do RON closings in Illinois,” the reader wrote in to HousingWire. “It seems as though the signing agent must affiliate with a RON platform provider in order to secure any signings. It also appears that the requirements for eVaults, eNotary logs, video records of the eClosing and other requirements are an impediment to independent RON notaries.
“It seems as though the successful companies will have an army of notaries licensed in multiple states in a call center environment that have the notary perform six to 12 eSign closing per day,” the reader continued. “I can envision the independent notary signing agent being squeezed out by high cost of getting certified to do RONs coupled by reduced signing fees.”
Notaries in some states, such as California, are nervous about the changes RON would bring to their role.
“The consumers in the world aren’t as tech savvy as we take them for,” said Matt Miller, the California League of Independent Notaries president and founder. “And most notaries tell me that you have to walk someone through how to use their webcam for the first time.”
Miller explained that notaries complain that through the use of RON, many of them end up playing more of a role of tech support as consumers struggle to understand how to use the technology being offered to them.
“There’s always going to be the person who just can’t do online notarization just because they’re not tech savvy, or they don’t have a reliable internet connection,” he said. “So the mobile notary isn’t going anywhere, much to the RON proponents’ chagrin, just because we’re finding out all the little loopholes and the downside risks to this technology.”
When artificial intelligence first started appearing on the mortgage scene, many feared it would take critical jobs away from loan officers and other housing professionals. The years have shown, however, that that has not been the case. AI has its place in the mortgage industry, but it is more often used to mine data and use this data to create predictions, help with marketing efforts and enhance the jobs of housing professionals that use it. Most experts now agree that AI will not take over mortgage lending, but instead give lenders that use it a tool to get ahead of their competitors.
One expert argues the same will be true of RON for notaries.
“I believe that platforms like us are the notaries’ savior,” Notarize CEO Pat Kinsel said. “And I mean that, without us, everyone is trying to get rid of the notary. They’re saying, ‘This is too much friction. I don’t need to go through this process. Why do we need to get things notarized? It’s ruining my business process.’ With us, people suddenly go, ‘Wow, this is super efficient. And you’re right, we should have an independent, third party verifying these documents, and it can be a highly efficient experience and cost savings and things like that.’”
Kinsel explained that while he can see why notaries would be skeptical of RON and worried about what it would mean for their jobs, he doesn’t believe this fear is necessary. In fact, the onset of RON could potentially separate career notaries from those who simply have a license.
“There’s four and a half million notaries in the country – there are more notaries than teachers,” he said. “There are only 40,000 professional notaries. So what we do as a company, is we take transactions away from notaries who are inexperienced and it’s not their actual job, someone who’s just in an office, and we give those transaction to the professional notaries, and we help them make a living doing that.”
If you were closing on a mortgage, it wouldn’t matter if it was 1950 or 2019 — the closing process from a title standpoint was exactly the same, Title ClearingHouse of Jacksonville President Valerie Saunders said. Then, 2020 changed everything.
Now, 2021 could be poised to bring even more changes to the title industry.
The role of the notary in the mortgage transaction is changing as eClosing options take over the market. But the evidence suggests their job is not going away anytime soon.