Can you close on a house remotely?
With so much important business conducted online these days, homebuyers often ask, “can you close on a house remotely?” It’s a great question because the option to not be physically present for all or part of a closing can make buying a house more convenient, especially for out-of-state buyers. It also just makes sense with the times. Overall, remote closings have become more common in recent years, but the landscape isn’t the same everywhere.
To get our facts straight, we prepared this short article explaining the most important details about closing on a house remotely.
First: Check If Your Title Company Can Close Remotely.
Your ability to close remotely depends on two key factors: Your title company’s adopted tech and local laws.
While many title companies are up to speed with modern technology, which includes e-signing and virtual identity verification, some may require in-person signatures and/or identity verification. Therefore, the ability to close remotely ultimately depends on the tech your title company has adopted (or not). While some areas may allow entirely virtual closings, if the title company doesn’t have virtual closing tech, you will still have to sign all documents in person in a traditional closing.
Also, a title company’s ability to close remotely depends on your state’s laws. Thankfully, trends are leaning toward more states allowing mainstream virtual closings. This trend accelerated greatly during the pandemic, doubling the number of states that allow virtual closings between 2020-2022.
Different States; Different Laws
However, not all states allow the same type of virtual closing. For example, some states require a real estate attorney to be present, which makes at least a portion of the closing an in-person affair. Here are your possible virtual closing options:
- Hybrid closing
- Remote online notarization (RON)
- In-person e-notarization (IPEN)
Let’s briefly talk about each closing type and whether you would need to be partially in-person or if it’s possible to be fully remote.
- Tip: Choosing mortgage lenders that allow you to e-sign documents will also make your home purchase easier. You will need to sign a lot of documents throughout the loan approval process, and electronic signatures allow you to sign with your smartphone. Perfect for an on-the-go lifestyle!
1. Hybrid Closing
With this option, your title company will allow you to e-sign every closing document that doesn’t require a notary. These documents can be sent to your smartphone, then you can sign them from the comfort of your home. Documents may be signed on the closing date, just a few hours before closing time.
Then, you will come to the title company and sign the remaining documents that require an in-person notary. These are called “wet signatures” because they are traditionally done with a pen and ink. Though this seems like it is a pain, a hybrid closing actually saves you about two hours, so it’s a great option.
2. Remote Online Notarization (RON)
With RON, you can do 100% of the real estate closing process online. You will get on a video call with your real estate agent and all necessary parties from the title company. Here, you will confirm your identity by showing your identifying documents, like a driver’s license. Then, you can proceed with the remote closing process.
You can e-sign everything and be done more quickly compared to signing every document with a pen. RON takes the place of “wet signatures” and is just as valid as signatures conducted in person with a notary. To have this convenience, your state must have a permanent RON bill. Funds will be processed via wire transfer to make the process completely paperless.
3. In-Person E-Notarization (IPEN)
An IPEN is another closing method that combines the benefits of e-signing with the security of in-person identity verification. In an IPEN, you sign the closing documents electronically but in the presence of the necessary parties, such as your realtor, attorney, and title professionals.
An electronic notary is used during this paperless real estate transaction, which significantly reduces paper waste and keeps all records in a secure file. While it’s not a purely digital closing, it offers several advantages, especially for first-time buyers that may have questions about closing costs, escrow, and any other figures in the home closing documents.
Can You Close on a House Remotely?
The short answer is yes, e-closing is possible, but it depends. As we mentioned before, your ability to close remotely depends on two factors:
- The title company’s adoption of remote closing tech
- Your state’s real estate laws on remote notarization (such as requiring an attorney to be physically present for closings)
As more title companies adopt the convenience of e-signatures, everyone can save a lot of time at the closing table. By eliminating wet signatures or requiring only a few documents to be signed in person, closings can be quick enough to happen during lunch breaks. Also, with fully remote closings becoming more mainstream, fewer buyers need to give a person power of attorney to sign for them in a different location. This makes the home buying process less daunting for many.
What About Remote Closings with Marketplace Homes?
Since Marketplace Homes is a nationwide brokerage, the type of closing available depends on local laws and the title company you choose. If you know you want a remote closing, first check to see if the home you want is in a state that allows remote closings. Then, find a title company that has adopted remote signing technology.
If you have any questions about remote closings or anything else related to real estate, contact us today!