The Paperless Transaction is Here to Stay
December 31, 2014
The real estate industry, among others, has embraced electronic signing and paperless transactions. While it may be a cost saver for some, clients and some Realtors can feel the price is high.
The data base for real estate documents has just been updated with hundreds of changes and responsible REALTORS have spent many classroom hours preparing for implementation. Electronic signing is now generally accepted in the industry and makes for efficiency in processing but not always in understanding.
It is designed for on-screen reading and signing. No one should ever sign any document until they understand it, but it is possible that in this environment many people sign because the trust the person asking them to sign. On-screen reading is very different from holding a piece of paper in your hand and
Most transactions are now completed via email. In a recent transaction, a busy doctor was purchasing a bank-owned property and was receiving documents from the escrow company, the home inspector, termite company, mold inspector, contractor, lender, HOA company and their REALTOR(r). It became overwhelming. It was made worse when he was informed by the lender via email that a Notary would be at his office a noon for signing of the loan documents. Because he is not always reading email, the Notary’s arrival was a surprise.
The documents did not reflect the terms of the purchase agreement or escrow instructions. The Notary patiently waited while explanations sought from the lender who stated the changes were emailed and he should have read them. This is not a client who spends his day on the computer, and this information was not received.
In another case, computer savvy first time homebuyers were given their loan documents the day there were asked to sign. The read almost everything and discovered two significant errors. They were assured they could sign them and the errors would be corrected. They had asked their lender to receive a copy of the documents ahead of time but did not. As a result, the documents had to be redrawn and there was a three-day rescission period and the escrow was delayed more than a week. This makes for a stressful ending for what should always be a happy experience.
I hope the industries embracing this new technology will balance the benefits and adjust for those who do better dealing with humans. REALTORS(r) still hold the keys to the home and even that takes hand-holding.