The Real Deal
Electronic signatures help ease paperwork
Buying a home became a little easier since much of the lengthy paperwork can now be done online. Even though Northern California is the seat of all things technical, other states beat us in approving electronic signatures on real estate contracts. In January, California began accepting these type of transactions via the worldwide web.
Thanks to state Sen. Byron Sher, D-Palo Alto, who authored the Uniform Electronic Transactions Act (SB820) which passed at the beginning of the year, some lenders and title companies now process the legal documents to buy and sell a home online. Once the transaction is standardized, it is expected that all lending institutions and escrow companies will provide this service.
SB820 recognizes many electronic contracts, records and signatures as legally binding, including sales contracts and rental agreements. Certain contracts, though, still require in-person signatures to stay compliant with the law. Those contracts that are excluded from SB820 are home equity sales contracts, foreclosure sales, seller-financing disclosure statements, tenant security deposits, three-day eviction notices and disposition of property left by tenants.
Prospective homebuyers have been shopping for locations, homes and mortgage rates online for four or five years now, but transference of title usually involves the traditional method of signing multiple documents by the buyer. Writer's cramp notwithstanding, the process has turned many a homebuyer into a nervous wreck!
Though many title companies are in the process of offering online signature capability for title agreements, the traditional approval procedure is still the norm. Some online services bring the buyer one step closer to electronic signature by allowing qualified Realtors and lenders to access their escrow accounts 24 hours a day, seven days a week; check the status; and print any documents they need for the buyer. All this can be done on a Palm VII Pilot hand-held computer.
"By entering a secured Internet link and providing an individual password, a Realtor can bring up real-time information on an escrow account and print out whatever it is the buyer is interested in knowing like, 'did the termite report come in?'" said Paul Grushka, vice president and sales manager for Old Republic Title. "Tracking down answers to buyers' questions during the escrow process accounts for about 30 percent of a Realtor's time. This service gives all of that time lost back to the Realtor."
The Internet can provide information on homes listed and mortgage rates offered, but there is still no substitute for the knowledge and experience of someone working and selling in the community you want to make your home.
Send questions regarding any topic that you would like to see addressed in this column to: The Real Deal, c/o The Silicon Valley Association of Realtors, 345 S. San Antonio Road, Los Altos, CA, 94022; call 650.949.9115; email ppompei@siliconvalleyrealtors.org.
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