Keeping a paper trail, even when eClosings are electronic
A lot less paper and ink are now involved home sale transactions since the virus crisis has dramatically accelerated eClosings, the industry term describing how the necessary contracts can be signed and sent from one party’s computer to another.
In some states allowing electronic notarization, home buyers/sellers can sign by simply tapping their own computer using a special platform sent to them and viewed remotely by a notary, eliminating human-facing contact.
But some states prohibit remote notarization and “some courthouse will accept electronically notarized documents and others will not,” explains Maureen Pfaff, president, Olypen Title, Port Angeles, WA.
See Your Public Records
Then, hybrid eClosings, where clients must still go into an office for a “wet ink” signing are required, with documents then electronically stored.
But while paper is disappearing, record-keeping shouldn’t.
“We recommend that buyers and sellers keep all the documents from their closing for at least seven years, or whatever their CPA or attorney recommends,” Pfaff says.
Attorney Deborah S. Bailey of Bailey Helms Legal, Roswell, GA, says records are necessary for a host of reasons, like filing income taxes, and if possibilities like post-sale title issues emerge.
“It is advisable to keep [some] paper copies of important settlement documents,” Bailey says. “Even if [buyers and sellers] elect to receive electronic copies, they will still receive some paper documents such as their signed settlement statement, deed and owner’s title insurance policy.“
Moreover, buyers and sellers have the option“ to request a paper copy of any documents they are receiving electronically, so it all comes down to what makes that home buyer/seller comfortable and how they are keeping records… If they are keeping records electronically, they may also request electronic copies of their settlement documents, even if they were signed using wet ink,” Bailey concludes.