April 20, 2020
Thank you to everyone who continues sharing information with us about the ways in which remote online notarization (RON) transactions are being accepted or restricted in various scenarios statewide. RON utilization is one of the biggest challenges that title agents face right now, and we're talking with our lending partners, RON vendors and governmental agencies to better understand how to further the expansion of RON availability and increase RON adoption rates.
This is a tough problem to solve quickly, but we continue to push everywhere we can. Here's the latest news on RON implementation broken down by key RON challenges and the corresponding solutions and tools that are operational or in-progress today. Below you'll also find updates on the temporary, crisis-driven use of Remote Ink-Signed Notarizations (RIN), as first reported here
Challenge #1: Few lenders are currently accepting RON transactions
Lending industry partners—including warehouse lenders and mortgage bankers—have shared with us several problems making it difficult to sell RON transactions to aggregators and elsewhere in the secondary market. Lack of technology infrastructure to handle digital closings is one hurdle. Additionally, many lenders still will not accept lender docs executed via RON. As a result, we are seeing lots of hybrid transactions across the state involving a mixture of RON and wet signatures. We're pleased to report that Fannie and Freddie have confirmed their acceptance of RON
, which we hope will lead to increased adoption among lenders and the secondary market. (Note: If you haven't done so already, we recommend you review both sets of FAQs from Fannie and Freddie containing COVID-19 guidance for lenders
We talked with John Fleming, General Counsel for the Texas Mortgage Bankers Association, and he shared these insights on the timeline for lender adoption of digital closing platforms as a result of COVID-19: "Not all aggregators in the secondary market and not all enterprise loan purchasers (e.g., FHA/VA) are ready for full electronic closings. For most closings, a wet ink signature on a note is still required. However, I am hearing that the COVID-19 crisis is accelerating the transition to electronic closing. So, by September 2020, I think the industry will have advanced to where it might have not otherwise been until September 2022."
Challenge #2: There are limited number of RON vendors in the marketplace
Current RON vendors are experiencing unprecedented demand, limiting their ability to serve all interested customers in a timely manner. You can find RON vendors via TLTA's digital closing vendor list
. The good news is that new vendors are coming online, so be sure to check back often, as the list will be updated regularly.
Challenge #3: There are a limited number of appointed online notaries in the marketplace
There's a limited supply of appointed Texas online and RON designated notaries. To find an online notary near you, search these Texas online notary filings
. Please note, this list of registered e-notaries changes daily and is a snapshot of those who had applied and received a commission as of the date noted. Before contacting a notary on the list, please confirm their commission is still in effect by conducting a search on the Texas Secretary of State's notary search.
Ready to obtain your appointment or pursue appointment for someone on your team? Review our new educational tool: Getting Started as an Online Notary
Challenge #4: A handful of county clerks continue to reject recording of RON documents
Our research indicates there are a handful of county clerks who are unaware of the papering out provisions in our state's RON statute that lawmakers approved last year. We encourage you to share this TLTA-produced RON resource for county clerks
that explains changes in the law.
Challenge #5: Lack of education on how RON works
While our state's RON statute is the model for the nation, the adoption rate on the ground reflects a simple reality – many simply don't understand how RON works. This educational resource produced by TLTA can help consumers understand RON
and what to expect if they want to use RON as part of their real estate transactions. Title agents please be aware of the following: Do not use video platforms such as Skype, Zoom or FaceTime for remote online notarization. The Texas Statute provides specific requirements for a proper RON transaction. Additionally, the national GSEs such as Fannie Mae and Freddie Mac have their own requirements and approved vendors and platforms. As always, check with your underwriter when considering a nontraditional approach to closing in response to the current challenges.
TLTA Proposed Emergency Executive Action on Temporary Use of Remote Ink-Signed Notarizations (RIN) Under COVID-19 Public Health Protocols
TLTA's board has requested that Gov. Abbott consider emergency executive action temporarily suspending traditional notary regulations to allow for Remote Ink-Signed Notarizations (RIN). Under RIN, a "wet signature" is still used, but the signature is witnessed by a notary via video and audio channels, and the notary seal is affixed at a later time. The Texas Association of Realtors submitted a letter to the governor supporting our proposal.
While the governor's office remains in a fluid, COVID-19 crisis response and recovery mode, they have communicated to us that they are working through our request for emergency use of RIN, and we can expect a response as early as this week. As soon as the governor takes action, we will alert you via a breaking news email. In the meantime, you might consider reviewing the details of our request
(and the cover letter
that accompanied our request) so you can be better prepared if the use of this temporary RIN tool is ordered by the governor. Of course, any executive action that Gov. Abbott takes may include modifications to accomplish other goals that may be important to Gov. Abbott and his team. If the governor acts, a TLTA Webinar will be available within a day or two to help you navigate the temporary use of RIN in the marketplace.
Fannie, Freddie Provide Temporary Guidance for Lenders on Use of RIN
Fannie Mae recently provided direction regarding the temporary use of RIN by lenders
, which closely tracks the requirements in the RIN proposal TLTA submitted to the governor. Additionally, Freddie Mac recently added an FAQ that addresses permissibility of RIN, as being proposed by TLTA (see Freddie Mac's Q6 here
To dig deeper and learn more, visit the RON section of our COVID-19 webpage
, or our Digital Closing Resources page
. Be sure to check back regularly, because we update these resources the moment new information or tools are available. And, don't forget to register for our new on-demand RON webinar
, which was presented April 16.
Thank you for continuing to share your feedback, providing us with updates, and trusting us to be your advocate in this challenging environment.
Here for you every step of the way,
Leslie Midgley, CAE
Executive Vice President and CEO
Texas Land Title Association