THE CLOSING; REMOTE, VIRTUAL, OR IN-OFFICE – YOUR CHOICE
HOW THE CLOSING OCCURS: IN OFFICE, REMOTE, VIRTUAL, AND PAPER CLOSINGS:
Remote Closing is where the Seller and/or Buyer are not at the Closing Agent’s office in person to sign the Closing Documents, receive moneys owed, and hand over keys, garage door openers, provide alarm codes, etc. Rather the closing occurs when the Seller and/or Buyer are outside of the Closing Agent’s office.
Paper Closings – once all of the Closing Documents are completed and approved by the Seller and the Buyer, the documents need to be signed. Witnesses are needed as well as a Notary for the Seller to conclude the Closing. A Paper Closing is when the closing papers and delivered to the Seller and the Buyer and they have the documents signed and then delivered back to the Title Closing Agent. The executed documents are usually returned via electronic format, with the Originals delivered thereafter, either by messenger, over-night delivery such as FedEx or DHL, or U.S. mail (U.S. mail is very discouraged as the package cannot easily be tracked and it takes longer, with a greater possibility of a mis-delivery). The moneys due the Seller can be sent via Wire, or a check can be delivered to the Seller. There is an arrangement made for the transfer of keys and other things needed for the Buyer to access the property.
On-Line Closings – after the Closing Documents has been approved, the Closing can occur. But where the Seller and/or Buyer are not in the Title Closing Agent’s office to attend the Closing, the parties can have a remote on-line closing. How does it work:
Electronic Transfer of Closing Documents – the Seller and Buyer, and their representatives, including the real estate agents, lenders, attorneys, and the Title Closing Agent, will communicate mainly via email. There will likely be telephone calls, video conferences, as well as text messages exchanged during the sale and purchase transaction. But the transfer of Closing Documents drafts and other paperwork involved can be sent via email attachment, as well as via emails containing a link to download the Closing Documents. The drafts are reviewed by the Seller and Buyer and their representatives and are approved prior to the Closing.
Final Tour and Inspections – more often, Buyers are relying upon a virtual tour of the property being purchased. Sellers and their agents may provide photographs and videos of the property that the Buyer can view. The Buyer may also arrange to have a physical walk-through, and even use a locally hired inspector to conduct any final walk-through inspections and reports be provided.
Closing Documents Prepared – the Title Closing Agent prepares to deliver to the Seller and the Buyer and their representatives the final Closing Documents that have been approved and they are sent via email or are made available via a secure download portal.
Electronic Signing of Closing Documents – Sellers and Buyers “sign” their respective Closing Documents electronically using a secure e-signature platform. These platforms are legally binding, and provide a digital trail of the signing process such as IP addresses of where the document was accessed, digital date stamps, and electronically created signatures.
Remote On-line Notarization – this is referred to as a RON for short. A RON is a notary public that has been approved to act as a remote on-line notary. The RON authenticates the identity of the parties signing the Closing Documents, and verifies the witnesses, and provide their notary seal to the document. This process is done using a qualified video conferencing system. Our law firm has several RON notaries that provide this service for our Closings.
Buyer’s Funds and Seller’s Funds are Exchanged – the Buyer delivers to the Title Closing Agent the balance of the money needed to close on the purchase. The balance due is based on the amounts owed per the Closing Documents, less any Escrow Deposit already provided. The funds are most often sent to the Title Closing Agent via Bank Wire Transfer, but can also be delivered by certified bank check, and other digitally approved means of transferring funds for closing. After the Closing Papers have all been digitally signed and delivered to the Title Closing Agent, then the Title Closing Agent delivers to the Seller the amount due to the Seller based on the Closing Documents, usually also via Wire Transfer, but could also be by certified bank check or other digitally approved means of transferring the funds to the Seller.
The Closing Transaction is Finalized – After the Closing Documents have been delivered to the Title Closing Agent, and the funds have been exchanged, the keys and other access required for the Buyer to take possession and control over the property purchased is provided to the Buyer. The keys may be provided to a local representative. Closing Disbursements are made to the real estate agents and other third parties that may be due funds from the Closing, and the Deed and any Mortgages are recorded, typically electronically through established portals for electronic filing.
ARE REMOTE ONLINE CLOSING SAFE? The answer is generally, yes. Technology has greatly increased the reliability and security of on-line closings.
Some Benefits:
- On-line closings can offer a more convenient way to Close
- Close when your schedule permits
- No need to spend the time traveling and waiting at a Closing
- Some Negatives: greater possibility of fraud
- Technology issues are always possible
- Potential for mis-communications in the process of Closing
But the technology and the ability to communicate with Fabrikant & Associates, PLLC, during the Closing process should significantly decrease the possibility that a remote closing will have any problem.
Using a Mobile Notary – Often, instead of using a ROM, the similar procedures above can be used except that a Notary that travels to the Parties can be hired. The Mobile Notary will either have the Closing Documents with them or the Closing Documents will be with the parties, and the Mobile Notary will be there for the signing of the Closing Documents and notarize the signatures. The party signing will need to make sure that if witnesses are needed, such as with the execution of a deed, the Mobile Notary generally does not provide them. So be prepared to have witnesses available.
MOBILE NOTARIES AND REMOTE NOTARIES ARE NOT THE SAME THING. A Mobile Notary travels to the parties in person and witnesses the Closing Documents being signed and notarizes the signatures. Remote Notaries provide the notarization services through on-line websites.
In-Office Closings – An in-office Closing is just that. The Seller and the Buyer meet together at the Title Closing Agent’s office, such as one of our law firm’s offices, and sign the Closing Documents, see that the closing funds are exchanged, and the keys and delivered to the Buyer. We love in-office closings, and look forward to having all of the parties together for the event.