Wire fraud, cyber security, and eRecordings are all big topics for the title and real estate industry right now. Technology is rapidly changing the way people buy homes and commercial property. eRecordings are becoming more and more common in the United States making transactions easier and more secure for all parties involved.
The average person in the United States uses more than 700 pounds of paper every year. That’s more than any other country in the world. The idea of a paperless world may sound impossible for the real estate industry since they rely heavily on paper and document paraphernalia to do business on a daily basis. From the lender to the underwriter to the realtor to the title agent to the municipality, paper seems like an inevitable part of the transaction.
Recently, in Michigan, a first has been achieved. A closing was successfully conducted with using only electronic signatures on all documents. Not one piece of paper was printed. The family who purchased the home used an online notary service, Notarize. The borrowers never set foot in the same room as the notary. Instead, the verification process was done over a Skype chat by answering a set of questions and holding up their driver’s licenses to the camera.
eNotary services are somewhat limited at the moment. Notarize’s Adam Base says that currently only 5 states allow remote notarization: Virginia, Texas, Nevada, Ohio, and Montana. While e-notaries are slightly less common, eRecording of documents such as mortgages, deeds, liens, releases and others are being utilized by more municipalities throughout the United States. Despite the reliance on paper by many, more counties switched to the electronic process this past year. As of August 1st, 2017, approximately 80% of the country’s population live in jurisdictions with eRecording capabilities according to Property Records Industry Association (PRIA).
eRecording is a burgeoning tool for real estate transactions in the United States. So you may be asking yourself, should I jump on the electronic bandwagon?
As a title agent, eRecordings offer several advantages:
- Saves time - documents are recorded in minutes
- Less errors - eliminates payment errors and rejected documents
- Reduces costs - no envelopes, stamps, or other mailing supplies to keep track of
- More secure than paper - sensitive information is sent directly to the municipality with little chance of outside interference
Some cons to consider are:
- Not everywhere… yet
- Training employees on a new process can be difficult and time consuming at first, but most services promise a smooth transition
If you are interested in learning more about e-closings and other technology promising to change the real estate industry, check out our Blog on blockchain technology. Blockchain platforms will revolutionize many industries. It promises to combat fraud in mortgage lending and streamline the transfer of title from seller to buyer more securely.
If you want to make sure every real estate transaction is secure and safe for your clients, check out our tips on cybersecurity.
Have you begun to transition to this new technology in your work? If so, what sort of issues or successes have you had with the new technology? Let us know what you think of all the hype in the comments.