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eSignatures, eNotarization, Webcam Notarization And iClose: What's The Difference?

eSignatures and eNotarizationsUpdated 1-28-16 with additional information on webcam notarizations.

Between the Federal Housing Administration expanding its electronic signature program and ServiceLink promoting its web-based closing system, iClose, the impact of technology on Notaries has become a hot topic in social media communities. But there also is a lot of confusion about electronic notarizations and webcam notarizations. Here are basic definitions of these terms to help clarify the differences between terms and processes.

Electronic Signatures
 

Any time you make a purchase with a credit card and are asked to sign a digital pad, or type your PIN to get money out of your bank’s ATM machine, you’re using an electronic signature or eSignature. Anytime you make a purchase on the Internet and click the “submit order” button, you are electronically signing a purchase agreement. Electronic signatures have become commonplace in the retail world, and they also are becoming commonplace in larger transactions, such as making an offer on a home purchase. eSignatures can be made in a number of different ways, but they are considered as legally valid as a signature on a paper document (often called a “wet” signature).

Electronic Notarization
 

Electronic notarization, or eNotarization, is essentially the same as a paper notarization except the document being notarized is in digital form, and the Notary signs with an electronic signature. Depending upon state law, the information in the Notary’s seal may be placed on the electronic document as a graphic image or other available means. But all other elements of a traditional, paper notarization remain, including the requirement for the signer to physically appear before the Notary.

Webcam Notarization
 

Many people confuse eNotarization with webcam notarization, believing they are the same. They are not.

Webcam notarizations make use of video and audio technology on the Internet to allow signers to personally appear before and communicate with the Notary at the time of the notarization. With traditional notarizations, the signer is in the Notary’s physical presence.

To date, only three states permit the use of webcam technology for notarial acts.

In 2011, Virginia became the first. Montana followed suit in 2015. However, both states limit the circumstances under which webcam notarizations can be performed.

In 2015, Florida also authorized webcam notarizations, but limits the practice to certain law enforcement and correctional officers who are permitted to administer oaths and affirmations.

However a number of states — including California, Colorado, Nevada, New Jersey, Oklahoma, Oregon, Ohio, Rhode Island and Wisconsin — have issued public statements that notarizations using online communication are prohibited and signers are still required to physically appear before Notaries.

iClose
 

iClose is a web-based closing system offered by one settlement services provider. With this system, the borrower physically appears before a Notary to sign a limited power of attorney (LPOA) in paper form. The LPOA allows a representative of the title company or lender to sign the borrower’s mortgage documents. Typically, the borrower will then log onto the iClose system to review and approve the loan documents using an electronic signature. The title company or lender representative signs all paper documents in the closing package, including the Mortgage or Deed of Trust, and a title company or lender Notary notarizes the representative’s signature.

Michael Lewis is Managing Editor at the National Notary Association.

7 Comments

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Concerned Notary

02 Apr 2015

What states are currently working on webcam Notarizations? And wouldn't this procedure greatly reduce the number of notaries needed? Therefore, reducing the overall notaries out there that need E&O, SA certifications, back grounds, and any other services that are normally required.

Kurt Gross

01 Feb 2016

If we could get the attorneys out of the way and apply common sense, then I think a workable solution is possible. For example a good starting point would be that a person could meet with a notary one time in person. Once this occurs that person and the Notary should be able to communicate via video from then forward. Other possibilities exist but right now I'm going to save my breath for audiences who actually can get things done. This public forum is a good start in that direction

Bernard R Stangel

01 Feb 2016

Thank you for the update. Wisconsin is a state that does not permit webcam notarizations based on your article.Does Wisconsin allow/recognize eNotarization? Thank you

National Notary Association

03 Feb 2016

Hello. No, The state of Wisconsin has not yet adopted statutes or regulations establishing rules, definitions or procedures for electronic notarization.

John McCoy

01 Feb 2016

RE: ID; I think a "sign by mark" certificate should be required by most signers. I cannot ID anyone who has a, similar to a chicken scratch, unreadable signature. I defy any person to ID a signature if it is also not printed.

dana@meridianleads.com

01 Feb 2016

Does the state of Pennsylvania use Webcam notarization or iclose for the witnessing of a will . The witness lives in Florida and the signed document is in Pennsylvania.

National Notary Association

03 Feb 2016

Hello. No, Pennsylvania does not authorize Notaries to conduct a notarization remotely with a signer remotely using a webcam or other audio/visual remote technology.

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