Gone is the day when homeowners had to physically visit the bank or title company office to sign loan documents in front of a notary. Today, borrowers can close loans whenever and wherever their schedule permits, thanks to mobile notaries.
Mobile notaries can be found in nearly every state and anyone who has been commissioned as a notary public can offer mobile notary services. There is no additional training or certifications required to notarize loan documents in 32 states; only to complete a form and pay a fee.
However, in the remaining 18 states and the District of Columbia there are requirements to take a course, pass an exam, or both. Additionally, not all states allow notaries public to perform loan signings. With the number of refinances and modifications continuing to grow as well as the increase in regulatory requirements, lenders must now ensure they are working with a settlement firm or a title company that has a solid understanding on how to meet regulatory requirements and also maintain the highest levels of customer service through the mobile notary experience.
While it might not seem to be the case, there are a lot of intricacies in selecting the right mobile notary. There are tens of thousands of mobile notaries in the country, and many of them are used regularly by title and settlement firms. If a consumer completes the mortgage process online or by phone, the mobile notary is the only representative the borrower will meet in person. The impression that the notary leaves may have a lasting effect on the borrower and ultimately their perception of the lender.
Fact: Up to 40% of closings performed by mobile notaries contain loan documents that are missing borrower initials, signatures or both. Title and settlement firms who manage their notary network are responsible for correcting those errors. Lenders are tasked with selecting the right title and settlement firms that best manage all of the intricacies while ensuring their efforts are compliant with current and pending regulations.
Having the closing process completed properly so that the borrower has a positive experience is paramount. Keep in mind, since settlement firms or the title companies retain and manage the notaries, they are ultimately responsible for delivering this experience. These companies typically have a large database of notaries with which they work on a regular basis, and they depend on them to professionally represent their firm as well as the lender. They have to answer to the lender if the process goes does not go as planned, as this puts their reputation and business on the line. Lenders should consider the following components to ensure the closing process is flawless:
Communication—As in any partnership, communication is key. There is a lot of necessary coordination involved between the lender, title/settlement firm, the notary and the borrower. Lenders must be a proactive partner with the title company to ensure they have all required information in a timely fashion and have communicated with borrowers for certain situations. For example, does the borrower need to provide a check? If so, to whom should it be addressed? While the title or settlement company manages the process, often the lender is the best person to communicate when borrowers need to bring cash to close.
System Platform and Process—Lenders want to partner with a title or settlement company that has a reliable, proven process that will allow real time communication. For example, when documents have been sent to the notary, does the title company know if/when the notary downloaded/printed the package? If the notary did not download/print the package, was the title company notified with sufficient time to schedule with another notary? Did the signing appointment happen and were the signed loan documents dropped in the overnight shipping prior to the daily cutoff time? While these may seem like simple questions, having the answers to these and many other questions differentiates the level of service provided by title and settlement firms.
Scorecards—Title and settlement firms should first establish methods to score notaries based on their timeliness when arriving at scheduled appointments, their professional image, and their ability to explain the documents being signed. Lenders want knowledgeable and experienced representation at the signing. Being able to measure this information and rely upon it to select the best available notaries when scheduling signings, provides a powerful solution to a lender, in that the best available notaries will always be retained.
Borrowers will continue to demand more flexibility in the mortgage process, hence the demand for mobile notaries will continue.
