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Minnesota Clarifies That NSAs Must Be Licensed ‘Closing Agents’

NSAs in Minnesota must be licensed Closing Agents to continue offering closing services.

The NNA has learned that, according to the Minnesota Department of Commerce, most Notaries who take on loan-signing assignments are required to become licensed as a closing agent.

This situation came to light in recent weeks after a number of NSAs contacted the NNA Hotline when they received “2015 Mobile Notary Questionnaires” from the Department of Commerce, which regulates the state’s Notaries and real estate closing agents.

The Department submitted the questionnaire to mobile Notaries who listed themselves on 123Notary.com in an effort to identify and help correct issues for those who might be operating out of compliance with state law. The questionnaire specifically asked questions such as has the Notary “notarized any real estate or title document, and picked up, shipped, or otherwise handled any check or other form of payment which includes funds required to close a real property transaction.”

Closing Agent Defined
 

Minnesota law defines a closing agent or real estate closing agent as follows: “Any person whether or not acting as an agent for a title insurance agent, a licensed attorney, real estate broker, or real estate salesperson, who for another and with or without a commission, fee, or other valuable consideration or with or without the intention or expectation of receiving a commission, fee, or other valuable consideration, directly or indirectly provides closing services incident to the sale, trade, lease, or loan of residential real estate, including drawing or assisting in drawing papers incident to the sale, trade, lease, or loan, or advertises or claims to be engaged in these activities.”

Just what constitutes “closing services” is not expressly explained in statute. However, in the view of the Department of Commerce, NSAs in the state need to be licensed because they often:

  • Charge or receive fees in excess of the per-notarization fee set forth in statute;
  • Explain documents to borrowers;
  • Receive trust funds (e.g., a check for closing costs); and
  • Advertise that they offer loan signing services.

State law lists the persons who are exempted from licensing, but the exemptions will not apply to most independent contractor NSAs.

Becoming A Licensed Closing Agent
 

The solution for NSAs is to apply for a closing agent license in Minnesota.

To qualify, an applicant must take an eight-hour pre-licensing closing agent course approved by the Department and pay a $115 application fee and an additional processing fee charged by the online licensing system vendor, for a license expiring on June 30 every two years. You can visit their website for more information about closing agent licensing requirements.

The Department of Commerce emphasized to the NNA that it is taking a “light-handed approach” in sending out questionnaires and responding to Notaries.

The Department’s tactic is to ask Notaries who are performing closing services without a license to stop providing loan signing services or obtain a license before continuing to offer services as opposed to issuing consent orders to cease and desist.

However, the Department also emphasized that any Notary who fails to complete the questionnaire, or after taking the questionnaire fails to provide additional information to the Department within 10 days, could be subject to administrative action including, but not limited to, a maximum $10,000 civil penalty per violation.

16 Comments

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Teresa Burrell

16 Jul 2015

What effect, if any, does this have on loan signings for Minnesota properties that are handled by a notary outside of the state of Minnesota?

National Notary Association

20 Jul 2015

Hello. At this time, the state Dept. of Commerce has only discussed with the NNA the requirement of licensing as a closing agent as pertains to Minnesota Notaries. We have not encountered a statute or rule that extends the requirements to individuals other than Minnesota residents.

Linda Mintey

20 Jul 2015

I almost seems like a conflict of interest. What will happen when client need notary out of state?

DAve

20 Jul 2015

this is a pain in the butt.

Katherine Durant

20 Jul 2015

With the added expense of the closing agent, should the fee charge be increased.

Alan

20 Jul 2015

State must be broke to start scalping notaries.

Velonda Thompson

21 Jul 2015

How many other states have this requirement?

National Notary Association

28 Jul 2015

Hello. Please see here for more information: http://www.nationalnotary.org/support/signing-agents/state-restrictions

Louis Lamannis

21 Jul 2015

Being that We are now being Licenced Mortgage Closers In MN, There is no reason to be a NSA. The Licence at the state level is a whole other ball game and trumps a lot of the requirments set up and instituted by the NNA. Also in MN the BCA does a background check automaticly before issuing a Notary Commission. And yes the fees have been lowered over the past 10 years and the NNA if on our side...should look at impossing regulations to make our fees more up to date.

National Notary Association

04 Aug 2015

Hello. Just to clarify, Minnesota does not automatically run a background check for all Notary commission applicants, only those that answer "Yes" to any of four questions on the signature page application form about past criminal, civil or disciplinary actions against the applicant.. For more information, please see the instructions on page 4 the "Notary Application" form at the MN SOS website: https://notary.sos.state.mn.us/

Lisa McKearnin

09 Feb 2016

Would thus apply to NSAs that also hold a title producer license, which is much more involved?

National Notary Association

18 Feb 2016

Hello. You can check the list of exemptions at the following link for more information: https://www.revisor.mn.gov/statutes/?id=82.641

Ivan Guardia

31 Oct 2016

I have a question on regards a loan modification documents notarized in MN thought the property is in California, I'm finding besides the Bank used the Wrong loan modification form,The name of the Authorized Person is not from the Bank.How I can have validate this document because I believe is Robo Sign Thanks for your attention.

National Notary Association

02 Nov 2016

Hello. If you suspect you are a victim of fraud, you contact local law enforcement or your state attorney general's office to report it.

Molly J

08 Jun 2018

Hi- In Minnesota can you be both a licensed MLO and real estate signing agent and practice each simultaneously (as long as the licensed mlo has no interest in transactions she’s signing for?) thanks!

National Notary Association

13 Jun 2018

Hello Molly. Please contact our Notary Hotline at 1-888-876-0827 or hotline@nationalnotary.org and one of our counselors can assist you with this question. Though our Hotline is primarily a benefit for NNA members, Notaries who are not NNA members may still contact the Hotline for complimentary assistance with one question.

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