One of the impediments to conducting “business as usual” while offices have shut down and work has transitioned to a remote environment due to COVID-19 has been the inability to properly execute financial and legal documents. This is particularly important in the real estate industry, as deeds and mortgages, as well as other crucially important documents, must be notarized in order to be accepted for recordation by local county clerks and other recording offices.
In an attempt to remove this barrier, two U.S. senators have introduced the Securing and Enabling Commerce Using Remote Electronic (SECURE) Notarization Act, which would authorize every notary in the United States to perform Remote Online Notarization (RON). RON allows for the notarization and execution of documents while the signatory and the notary are in two different locations through the use of two-way audio-visual communication. The Act would establish guidelines such as multifactor identity authentication and recordkeeping via audio-visual recording of the notarization. The Act has been endorsed by the American Land Title Association (ALTA), the Mortgage Bankers Association (MBA), and the National Association of Realtors (NAR).
Twenty-three states have already implemented their own RON standards, and legislation is pending in 13 others. The SECURE Notarization Act would not replace states’ laws for document authentication. It is likely that each state would have to adopt similar legislation and change the powers it gives its notaries.
It is important to note that the federal government’s ability to require the states to adopt RON is limited and untested in the courts. The Act would apply only to interstate commerce and the federal courts, and would require a state to recognize remote notarization performed by a notary public commissioned by another state only where the notarization occurs in or affects interstate commerce. Moreover, the Act would not, and could not, require private businesses, such as banks and title companies, to accept remote notarization. We will continue to monitor the progress of this bill and any changes to it, and will provide a further update if it passes.