One of the biggest reasons why Homesale Realty has been so successful in 2020 and 2021 is our team's focus on learning, adapting, and embracing new ways of doing things as the market changes. One big example in recent times is the new digital closing process.

For buyers and sellers alike, closing day on a home is a big occasion. But it's not all fun and games: In fact, both sides can end up spending hours reviewing and signing off on paperwork. In the opening days of the COVID-19 pandemic, everyone knew an alternative was crucial.

The result is digital closing.

What Is Digital Closing?

Digital closing, also known as e-closing, is the fastest and most efficient way to close on a home today.

Even though the public health crisis seems to be lifting, buyers and sellers alike have learned they appreciate the convenience of digital closing. Many will continue to opt for it, so it's here to stay.

In an e-closing, at least one document for the mortgage closing is signed electronically. The goal of the closing, also known as the settlement, is to finalize the loan and transfer ownership of the property.

Depending on the circumstances, there may be dozens of individual items that all need to be signed. These include critical legal documents like the promissory note, the transfer deed, and the deed of trust. Sometimes, a seller can pre-sign, and will not need to attend.

However, buyers are subject to more intensive identity verification, necessitating e-closing.

What Are the Different Types of Digital Closing?

Although the ultimate goal is to have all these documents available in digital form, this isn't always the case. It's still relatively rare to have a promissory note or deed of trust ready to sign in a secure digital format. With that in mind, there are several different kinds of digital closing your clients could encounter.

The different varieties of digital closing include:

• Hybrid E-Closing
  In a hybrid e-closing, some of the paperwork is signed digitally by the buyer (and potentially by the seller). To conclude the transaction, however, the parties must meet with a notary in person. This is still the most common form of e-closing, which may disappoint some clients, but it's much faster than a traditional closing.
  
  
• In-Person E-Notarization (IPEN)
  The buyer and the notary must meet face-to-face as part of identity verification for the loan. However, all of the documents are digital. They are signed electronically on a tablet or computer and then notarized digitally. This is the second most common approach to e-closing in real estate.
  
  
• Remote Online Notarization (RON)
  This "true" e-closing is what the process might look like in the future. The identity verification step is done by having the buyer and the notary meet through a secure videoconferencing platform. Then, all the documents are signed and notarized digitally, exactly as in IPEN.
  
  By January of 2020, 14 states had fully implemented RON, including Texas and California. Throughout the course of the pandemic, many states temporarily suspended parts of their in-person verification rules as a public safety measure. However, it is possible that RON will be rolled back in some states by 2022.

Before closing day arrives, connect with your client's mortgage lender and title company or real estate lawyer to be sure you understand which version of the process you'll undertake. Walk through the process with your client so they know what is expected of them, especially if there's still an in-person component in your state!

Contact BHHS Homesale Realty to find out more about great customer care in the post-pandemic