Months before COVID-19, Attorney Colleen Sullivan and her colleagues at Ward Damon, a multi-disciplined law firm in West Palm Beach with a large real estate focus, began preparations for remote online notarization (RON) eClosings. It wasn’t until COVID-19 however that Ward Damon conducted their first RON transaction.
“[At the height of the pandemic] about 20% of all our non-borrower signings used RON,” Sullivan said. Moving from zero RON transactions to one in five transactions using RON required careful internal planning. And for all transactions involving a borrower, tight coordination with lender partners is crucial.
Qualia joined Sullivan on a call to discuss Ward Damon’s strategy for implementing RON and how the Ward Damon team approached coordination with their mortgage lender partners. She provided insight on how to build trust and collaborate with lender partners to carry out successful remote closings.
Be a RON advocate
“The biggest hurdle we’ve faced has been getting lenders to approve RON,” Sullivan said. Lenders have historically been unable to conduct RON eClosings due to their inability to sell RON transactions to aggregators, government sponsored enterprises (GSEs) and elsewhere in the secondary market. This started to change during COVID-19 when GSEs such as Fannie Mae and Freddie Mac announced their acceptance of RON; however, many lenders are still reluctant to accept RON.
Sullivan encourages title & escrow companies to do as Ward Damon did and “be the squeaky wheel” by consistently sharing RON knowledge with lenders and encouraging them to consider investing in it. “When loan officers start losing market share because they aren’t on board with RON, they will come to you,” she said. “You’ll be in a position to help steer the lender’s technology requirements and how the process is laid out.”
Sullivan cautioned that typically a title or escrow company won’t have much control over the platforms and processes a lender uses; however, demonstrating your RON proficiency can go a long way in getting yourself a seat at the lender’s decision-making table.
Train your team on RON platforms
“You’ll need to be flexible,” Sullivan noted about working with lenders on a RON transaction. Lenders often require title & escrow businesses to use one of their approved RON platform vendors. These vendor selections are often requirements of their investors or council decision makers.
Sullivan suggested that title & escrow businesses register with and prepare themselves to use RON platforms. A good working knowledge of RON vendors ensures an agent isn’t caught off guard by the platform’s interface during a closing. A solid understanding of RON options also allows the title company to guide lenders toward the best RON provider for a particular transaction type.
Consider RON-certifying all closers
While flexibility is paramount, Sullivan noted that Ward Damon maintains one requirement: a closer from the law firm must be on every closing. This narrows Ward Damon’s pool of RON platforms to those that can accommodate this requirement.
Because Ward Damon wanted to be involved in every closing, Sullivan and all other closers on the team completed the state’s requirements to become certified as remote notaries. This measure empowered Ward Damon’s closers to gain basic proficiency and a working knowledge of the RON process.
The process of RON-certifying the entire team also helped Ward Damon develop trust with their lender partners who were wary of RON transactions. Mortgage lenders rely on their title & escrow partners to accurately execute a closing with zero errors. Because Ward Damon’s closing agents join every RON eClosing, the law firm can assure their lender partners that the closing will be properly and securely executed every time.
Sullivan’s biggest piece of advice when handling RON transactions with any stakeholder was to over-communicate. Sullivan offered a few recommendations for handling communication during a RON transaction:
- Offer RON early on in the closing process. RON requires quite a bit of coordination and upfront planning. The closing agent can also help the consumer understand the costs associated with a RON transaction compared to mail away or other contactless options.
- Constantly communicate with lenders. To successfully conduct a RON eClosing with a borrower, you’ll need to communicate with the lender early and often to discuss the appropriate platform for the transaction type. Sullivan stressed that transparency throughout the process was fundamental to successful coordination with lenders.
- Attend every closing. As stated earlier, involving yourself in every transaction ensures that the process runs smoothly and that the borrower, lender, and underwriter feel confident that the entire closing was to standard.
Will RON continue beyond the pandemic?
“If you would have asked me three months ago [if RON would be commonplace], I would have said this would take 10 years to get off the ground,” Sullivan said. Now, Sullivan believes RON transactions will become more commonplace due to the momentum catalyzed by COVID-19.
Sullivan cited the changes made by Fannie Mae and Freddie Mac to accept RON transactions as a major driver for RON among large lenders. “We’re starting to see more lenders consider RON closings now,” she said.
To learn more about RON eClosings and how to get started, click HERE to download our eGuide “All Eyes on RON: Accelerating industry-wide adoption and how key players can get started now.”
About Ward Damon: Ward Damon is an AV-rated, multi-disciplined law firm serving the legal needs of South Florida since 1987. Ward Damon represents businesses and individuals through legal counseling, transactional work and litigation in federal and state courts. Attorneys support clients in a variety of practice areas including real estate, business and corporate, marital and family, labor and employment, healthcare, construction, intellectual property, wills, trusts, and estates and more. The firm has offices in West Palm Beach, Boca Raton, and Jupiter/Juno Beach. For more information, visit www.warddamon.com or call 561.842.3000.