According to a McKinsey Global Survey, the COVID-19 crisis has accelerated the pace of digitization in customer interactions by three to four years. With people getting acclimated to a seamless digital experience across industries, mortgage originators have been forced to adapt - or risk losing business.
Digitizing certain processes - such as loan applications - has simply been a matter of putting the right systems in place. But for notarizations, the move towards an online experience has been slowed not only by technology, but also by government regulations.
But as Bob Dylan said, “the times, they are a-changin’.”
As of the end of June 2021, 34 states have permanently legalized remote online notarization (RON). That number was less than two dozen in November 2019, a few months before COVID-19 changed life as we know it.
Then there’s the Securing and Enabling Commerce Using Remote and Electronic (SECURE) Notarization Act; which is federal legislation that would create nationwide standards for RON. With bipartisan support - the bill was introduced by Senators Mark Warner (D-Va.) and Kevin Cramer (R-N.D.).
So, remote online notarization looks like it’s here to stay. But what exactly is remote online notarization? And why is it important to offer it to your customers?
What is a Remote Online Notarization?
According to National Notary, Remote Online Notarization is the act of performing a notarization remotely using two-way audio-video technology. It is the online equivalent of an in-person, paper-based notarization where every part of the process is done via the internet.
Like traditional notarization, RONs begin with the online notary verifying the signer's identity and ensuring the signer understands the document and is willing to sign it. The signer's wet ink signature is replaced with an electronic signature, and the remote notary's physical stamp and handwritten signature are replaced with an electronic seal and digital certificate, respectively. Payment is handled at the end of the transaction.
Why Should You Offer RON to Your Customers?
The reason why more and more processes are being digitized can be boiled down to one word: convenience. People are busier than ever - or so it seems - and in the Amazon age, they know they don’t have to settle for a disjointed, lengthy experience.
Since remote online notarizations don’t require the signer and notary to meet in person, they eliminate travel time. The whole process can be completed in a few minutes without either party leaving their home.
But there’s more to it than convenience. We also have to consider the after-effects of COVID. As we continue to navigate through the effects of the pandemic, there are still a range of opinions on whether or not to meet in person. By offering remote online notarization, you can give customers a sense of safety.
And consider that people have gotten used to doing eClosings over the last year-and-a-half. In 2020, Docutech, for example, experienced a 768% year-over-year (yoy) surge in eClosings. Remote online notarizations are turning into an old habit, and you know what they say about old habits.
You Need the Right Systems in Place
If you’re looking to keep up with the real estate industry's inevitable move to RON, and you don't have the right technology in place to get you there, consider our cloud-based mortgage loan origination software (LOS), MeridianLink Mortgage, formerly known as LendingQB®.
MeridianLink Mortgage's innovative Open API framework allows companies to seamlessly connect to over 250 vendor partners, including best-in-class document providers to help you stay ahead of your competition - who are surely starting to understand the benefits of digitization.
As the technology continues to advance, we're committed to providing cutting-edge solutions for mortgage originators. At MeridianLink, we're always eager to make the process as streamlined as possible for both the user and the lending institution.
Download eBook: Remote Online Notarization (RON) Trends Likely to Persist, to learn more.