Getting a mortgage without leaving your bedroom

 Mortgage Process  Comments Off on Getting a mortgage without leaving your bedroom
Jul 232018

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By G. Steven Bray

The real estate and mortgage industries historically have been paper intensive. Getting a mortgage typically involved signing lots of paper documents. That is changing, and many companies now allow you to apply for a mortgage online, but a truly paperless mortgage process has been elusive. Documents signed at closing require a notary seal, and Texas law required a notary to be physically present when a borrower signed the closing documents.

That changed this summer with the implementation of HB 1217, which introduced online notarization to Texas. To understand why it took so long for this to become a reality, you have to consider a notary’s functions.

The concept of a notary public dates backs to at least ancient Rome, and today’s notary public still operates as an officer of the State. A notary’s primary duty is to show that a disinterested party has notified the signer of a document as to the significance of that document and has ascertained that the signer’s identity, signature, and reasons for signing the document are genuine. That was difficult to do in the past without the signer physically appearing before the notary.

HB 1217 has allowed us to ease our way into the 21st century by redefining “personal appearance” to include the use of two-way audio-video communications. With this, Texas becomes the third state to allow notarization of documents this way.

Being an online notary requires a special commission, and online notaries have extra record-keeping responsibilities, so it may take a while before online notarization becomes common. The state also allow online notaries to charge a small fee for the service.

I understand the first online mortgage closing in TX occurred a couple weeks ago, and it may not be too long until you can buy a home start to finish without getting out of your pajamas.