In The News: Patchwork of state laws hurts U.S. effort to modernize mortgages
NEWSWIRE: Sept 9, 2016
DATELINE: New York
Lenders have long recognized notarization as a critical anti-fraud measure. But the practice – which dates back at least to Ancient Rome – is becoming passé in an era of FaceTime, Skype and live-streamed social media.
The financial industry is pressing for change in the form of “remote notarization.” The service, available through companies like Notarize Inc and NotaryCam Inc, uses secure webcams to link borrowers and notary publics. Before their virtual meeting, borrowers must answer random questions from their credit histories to prove who they are.
But adoption has been limited because a patchwork of laws in most states does not allow for the practice, and city and county governments are slow to change. Investors who buy the loans also impose restrictions, such as requiring original signatures to avoid fraud.
This causes frustration, delay, and unnecessary burdens on people whose lives are often not tailored to rules and regulations of a century ago.
Case in point – civilian paramedic Chuck DeBonis. After wrapping up his stint as a civilian paramedic at a military base in Kuwait earlier this year, he found a home he wanted to buy in the Virginia town of Bristow for his return.
The problem? His mortgage lender wanted him to sign paperwork, in person, in front of a notary public. So the 30-year-old flew 6,500 miles to sign on the dotted line.
“It was ridiculous and unnecessary,” DeBonis said in recounting his 14-hour trip.
His is just one of tens of thousands of stories that are helping push all stakeholders slowly – but surely – towards modernization of these practices.
Read the full article here.
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