5 Things You Need to Know About the Rise of eClosings
If you’ve ever bought or sold a house, you know the extraordinary amount of paperwork involved. There are countless jokes about the number of pens you’ll need or the number of trees that go into the closing documents.
Closing has been cumbersome and time-consuming and it’s the last thing the buyers and the sellers want to sit through. If you feel that way, you’ll be happy to know those days are soon coming to an end as the industry embraces eClosings.
Here’s everything you need to know about why they’re the preferred method of closing, what’s making them so popular, and what it means for your next closing.
5 Great Things About eClosings
Let’s get the obvious one out of the way. It’s a good move for the environment, using less paper but it also cuts down on ink usage and the number of times you need to sign your name, making the closing process a lot more enjoyable for everyone involved.
Less Chance for Error
This is one of the reasons the Consumer Financial Protection Bureau ran an eClosings pilot program. With a traditional closing, there are numerous paper documents. The more documents, the greater the chance of error and the less chance it will be spotted. With eClosings, the information feeds from a common area, which decreases the potential for error.
For those few times when the information is incorrect, it can be updated quickly and everyone has peace of mind that it’s been updated in every spot.
Hybrid Closing Options
Even though e-closings are secure business transactions, there are still some people who hesitate to close this way. For them, there are hybrid versions that use e-documents for some of the paperwork and paper documents for others such as the actual mortgage note.
More Time to Review Paperwork
With an eClosing, borrowers generally have more time to review paperwork and they can do so anywhere they have a secure Internet connection. If they find a discrepancy, they can quickly request a change to be made. The change can be carried out efficiently and new e-documents will be available for their review without having to wait on a courier or stand by a fax machine. This also helps everyone stay in compliance with TRID timelines.
More Education Components
Traditionally, consumers have cited problems reviewing closing paperwork because they don’t feel they have enough time and don’t understand some of the terms used. In eClosings, that is not the case. Not only do they have more time for review but terms are hyperlinked with definitions that make it easy to understand what’s being signed and why. No more guessing or just assuming everything’s in order.
Today, all 50 states have some sort of eSign statute or law and it’s been over 16 years since Congress enacted the Electronic Signatures in Global and National Commerce Act, which makes the use of electronic signatures and records binding under federal law.
If you’re closing on a home, select the option that is efficient, secure, and provides the best experience possible. Contact us at Bay National Title Company today and we can help you have an enjoyable eClosing.