The pandemic has changed the way people buy and sell houses. From virtual tours and open houses to eclosings, social distancing transformed real estate operations. Agents scrambled to find ways to connect with clients and remain profitable during quarantine and the cautious days that follow. As a new normal takes over, discover ten facts every agent should know about eclosings.
What is an eClosing?
As all types of procedures go digital, the first concept to understand is what an eClosing means. During an eClosing, the execution and electronic signature of essential mortgage documents are performed in a secure digital environment. Other forms might require printed and a physical signature in the presence of a notary public. These documents could be obtained via fax or express delivery by the individuals, who would visit the notary and sign in his or her presence. As a result, closings are done without several people gathering in a small office environment. Buyers concerned about their safety feel more secure knowing they can close without a lengthy meeting between multiple parties.
Three Types of eClosings
Some states do not yet fully permit remote online notarization. As a result, there are three types of eClosings. A hybrid eClosing occurs when the borrowers and notary meet in-person to sign some documents traditionally and others digitally. With remote online notarization, all the documents are signed virtually, and meetings between the borrowers and notary may occur via webcam. Traditional in-person closings occur when the borrowers and notary meet in-person electronically execute and notarize digital documents on a computer or tablet. Agents can try to negotiate a situation that makes their clients feel most comfortable during quarantining.
Electronic Documents Require a Signature
One of the more common errors made during the closing process was neglecting to sign critical documents. Fortunately, eClosings eliminate this problem as electronic records require a signature for submission. If a document is unsigned, it is immediately detected to avoid holdups and issues later. The closing process is streamlined and faster because eClosings eliminate the tedious process of checking documents for signatures and resubmitting overlooked ones. Real estate agents get paid faster, and clients are pleased to close quicker.
Time to Review Documents
Preparing closing paperwork was a grueling process that could take weeks to complete. This meant the closing documents might not be available until a day or two before the closing date. Now the paperwork is completed in a virtual environment, making it accessible to everyone long before the official closing date. Buyers and agents have time to carefully review the agreement’s terms to ensure they reflect the agreement between all parties entirely. Any inconsistencies can be corrected before the closing, rather than trying to handle them at the closing table. Having ongoing access to the closing documents also allows agents to best negotiate the terms for their clients.
Eliminate the Paper Chase
A myriad of documents is required to close on a house. Keeping track of all these documents between parties is a paper chase that often leads to loss and frustration. Documents may get separated, and key pages are lost, necessitating duplicative work and delaying the closing. Less paperwork also means a reduced need for storage, as documents are kept on a flash drive or in the cloud rather than hauled around in large folders.
Minimize the Risk of Error
Omissions, duplications, and missed signatures can be detected electronically to reduce the risk of error. The documents are generated throughout the process, so inaccuracies can be spotted by any of the parties before they turn into a time-consuming problem. Plus, electronic documents include tracking mechanisms to verify the delivery, receipt, and acknowledgment of the closing paperwork.
Highest Level of Protection
An agent strives to protect clients and negotiate the best possible terms on their behalf. Agents who do it well prove their worth and get more referrals through word-of-mouth and positive online reviews. Suggesting eClosings helps agents provide the highest level of protection to their clients. Ongoing access to documents means issues are quickly addressed before the closing date to memorialize the parties’ agreement accurately.
Integrated Access to the Latest Information
Agents can also encourage their clients to access the latest documentation online and review it to ensure accuracy. Clients with an eMortgage application can check interest rates, terms and conditions, and more without waiting to contact the lender. Closing documents are signed, verified, and processed in advance to reduce the time and effort spent on closing day.
Security is a concern for many buyers, who may hesitate to schedule eClosings because they are concerned that confidential information could be compromised. Advanced digital technology offers optimum security, with protective systems in place, with no lost or missing paperwork along the way. Over the past five years, consumer organizations found eClosings are a fast, accurate, and secure option.
Boost the Real Estate Market
Finally, agents who schedule eClosings help keep the real estate market active during and after quarantine. Innovative thinkers keep the industry busy during challenging times. Agents with the foresight and expertise to conduct virtual tours and eClosings during the pandemic will remain active and profitable in the days that follow because they helped keep the industry moving forward.
Before the pandemic, eClosings were becoming a popular way to conduct business without all the hassles associated with manual paperwork. Today agents looking to sell houses recognize the need to get the facts about electronic submissions to help their clients navigate the process comfortably. Learning about technology today is the smartest way to stay relevant as an agent tomorrow.