April 2021

Remote Online Notarization in Mortgage Loan Closings

The Review of Banking & Financial Services
Joshua C. Prever | Brian J. Goodrich

Holland & Knight Partner Joshua Prever and Associate Brian Goodrich published an article in the April 2021 edition of The Review of Banking & Financial Services regarding the use of remote online notarization (RON) in mortgage closings.

The article describes how RONs work and how the pandemic has accelerated their adoption by state legislatures, in addition to the benefits of using RON and strategies to mitigate any risks.

RONs offer an alternative, allowing documents that require notarization to be done remotely and providing lenders with a completely digital record of the loan transaction. The desire to move away from paper, and the pervasive need for virtual services and operations, has cemented and accelerated the need for new solutions such as RON.

To date, 28 states have enacted RON statutes, with three of the enactments coming within the past four months. It is well beyond doubt that RON will play a significant role in the mortgage industry henceforth, and those in the industry would be well-served by learning about and adopting this latest advancement.

Those that adopt RON should consider updating template loan documents to include representations and acknowledgments that the parties agree to utilize electronic documents and electronic signatures. This will mitigate the risk that a party will be able to successfully argue that the documents are unenforceable.

READ: Remote Online Notarization in Mortgage Loan Closings

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