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June 6, 2013

Industry Standards in the Notary Business

Many notaries claim to understand the loan signing business well. But, there are many things that even experienced notaries don’t know. Here are some industry standards to think about.

(1) Cross outs
Some lenders allow them while others don’t. As a best practice, avoid crossing anything out unless you have gone through all other recourses without any luck. You should ask your contact person if they think it is okay to cross-out before doing so. If you can’t reach your contact person, see if that company allows cross outs. Remember, even if a company allows cross outs, it can compromise an entire loan and cause a redraw. So, don’t be “Cross-out-happy”.

(2) Initialing
This topic is not well taught, but really matters. I have received instructions that are identical from two unrelated parties. One was a processor, and the other was the owner of a signing company. Both instructed me that if a surname is spelled incorrectly in the signature section of a document, the initial goes UNDER the name. The processor noted that it should ideally go under the last several letters of the surname. Why? The processor or quality control people involved in the loan need to type in the corrected version of the name, and if you put initials where they are going to type, they will run out of space. This is a practical consideration and not a legal one. Initials go UNDER, so that retyped names can go to the RIGHT. This is a test question by the way.

(3) Order of documents
Most companies like documents returned in the same order they were submitted. Some are more flexible than others about this, but it is easier and more organized for them. That way they will know right away if they are missing something. Checks or notes should go on the TOP of the package and ideally attached to an 8.5 x 11 document so they don’t float away if unattended. Gusts of wind and careless coworkers walk by, bumping into things, and sending loose documents flying. I remember a client who lost a $20,000 check that I specifically remember putting in the package. Hmmm. Be careful — I am!

(4) Unsigned documents
If a borrower won’t sign a document, it should be returned at the TOP of the package. You don’t know who will open the package. Often it is a secretary, assistant, co-worker, or someone other than the contact person. If they don’t realize immediately that there is a problem, then there will be a delay fixing the problem. Remember — these folks are multitasking, and your loan is not the only one. Although you told them in a phone message that there is a problem, they still need the problem to be in their face.

(5) Hustling the borrowers
If a borrower doesn’t want to sign a document, don’t start off by pulling a “used car salesman” tactic. Call the contact person you have, i.e. Title, signing company, lender, etc. Leave a message, and allow 20 minutes for them to call you back. Call them once more if you don’t hear from them and wait another five minutes. If you still don’t hear from them, then you can tell the borrower about their three day right to cancel, and how if they don’t sign the document they might be facing a redraw. Remember, don’t start off by twisting the borrower’s arm — that is a last resort and is very rude and unprofessional to start off that way.

(6) Fedexing back the documents
If there is a problem communicating with the lender or other contact person, don’t delay Fedexing documents back unless instructed to. Many signers feel that it is “professional” to hold on to the documents until the next day until right before the Fedex deadline. Guess what, you might hear from the lender with instructions or you might not. But, what if you get busy and FORGET to dump the Fedex? What if you or a family member has a health emergency and you can’t drop the Fedex? Do you think of these things? Get rid fo the Fedex THAT NIGHT into the drop box at a staffed Fedex station if possible even if the staff are no longer there. It will get picked up. Remote drop boxes are sometimes risky, but boxes at Fedex stations are very safe. Think when handling time sensitive documents.

(7) Emailing documents back
If you get e-documents and have a question, don’t scan and email a document back. That is NOT secure. A hacker could do identity theft. Lenders are very uncomfortable with the idea that a notary would compromise their information. Use a phone or a fax, but not email for sharing information about the borrower. Remember, that when you received the documents, the portal was PASSWORD protected.

(8) Instructions
Many lenders have a letter of instructions when they assign a loan. The industry standard here is that there is no standard. Some lenders give written instructions while others don’t. Each one wants something different. Follow instructions to a tee, and you will be first on their list.

(9) Explaining things to the borrowers
If you are NOT in an attorney state, you can explain generic information about documents to the borrowers. But, do not give specific information about their loan, specific answers to questions about their loan, or commentary particular to their loan. Not allowed. Don’t even tell them their Rate. Just point and say, “Is this what you asked about?”. That way you are carefully refraining from telling them anything which they could accuse you of misstating after the fact.

(10) Confirm the completion of the signing with a tracking #
When you are done with a signing, leave a message with the Fedex tracking number.

(11) Title & Escrow prefer blue ink
I always used black unless specifically asked to use blue. But, many lenders nationwide prefer blue ink so that they can identify an original from a B&W copy immediately.

(12) Take the Fedex to a HUB.
Remote drop boxes are a recipe for disaster. Title will be all over you if the documents don’t get back on time. Find out where all of your local Fedex stations are. You could lose your best client if the documents don’t get back on time. Get a receipt too and save yourself a lot of problem. Not an industry standard, but it SHOULD BE.

(13) 40% of signing companies say: Don’t call the borrowers.
If you don’t call the borrowers, they won’t know that you are coming. Half the time, they won’t be ready for you either. So, unless you are absolutely sure that the company will pay you if the borrowers don’t sign, then think twice.

(14) Sign exactly as the name is printed
What if the identification doesn’t have the same name variation? Your Secretary of State might not take kindly to the fact that you notarized them under a name that is substantially different from what their ID reads. Proceed with caution and use a Signature Affidavit if necessary. Make sure that middle initials are clearly signed too so that the lender can sell the loan. If any part of the signature looks like it is omitted, reselling the loan will be a problem.

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January 20, 2011

Notary Industry Standards According to Ken

Filed under: Ken Edelstein — Tags: , — admin @ 11:24 am

“It’s an Industry Standard”, sayeth Suppository Signing Service (SSS) when insisting that I accept payment on the 45th workday after the next lunar eclipse. Usually the “defense/attack” of industry standard is used to support an unfair/immoral situation; one that most likely will be “going away soon”. Slavery was an industry standard. Women not having the right to vote was an industry standard. The inclusion of cocaine in Coca Cola was an industry standard. I am sure you can add many currently unjust and destined to disappear practices to the list.

Just who decides what “Industry Standards” are? That’s simple – those (currently) in Power. They are saying that “it should be because it is”. Really? Change for the better is the history of and most basic philosophy of our great nation. Twelve year old children working 14 hour days in coal mines was an industry standard. IS (Industry Standards) change all the time. Unjust laws are changed, oppressed workers form unions, and civil/lawful peaceful protest leads to abolishing IS.

Thus, when SSS wants to “stick me” with their IS; I tell them that their IS statement is obsolete. The current IS is paying via PayPal “up front”. That is MY IS and they can “self administer” their assignment if they are “sticking” to their outdated concept of notary payment IS.

The issue is bigger than just payment. There is an outdated IS perception of the notary as being a “dumping ground” for various tasks. The IS of loading the doc with endless pages of survey, un-necessary FAX requests (not immediate funding, eg: package has 3 day recession), baby monitor calling; the list is practically endless. We are an industry, notaries are the first line of defense against fraud; our task is honorable and necessary. The vast majorities of us are highly skilled and know an Ack from a Venue. The IS of treating us like fools is coming to an abrupt end.

There are many ways to “bounce back” an IS attack. Ask precisely where that IS is codified. Yup, it’s only in the speaker’s mind; because that is the way they would like things to be. You don’t have to accept their IS – TELL THEM YOURS. I have had condescending calls from SSS telling me “you must accept our terms” – really? Not me. And, I sincerely hope the same will be true of you.

The IS statement is just a lot of hot air, being blown in your direction. Why? Because often that tactic works. Many don’t like to “stand out” and wish to swim with the school and fly with the flock. But when that school is heading toward the fisherman nets, when the flock is coming within shotgun range of the hunters – it’s time to change course. Their IS puts all the advantages on their side. You are playing poker with your cards being double sided, and their cards show you nothing.

We all know what is fair and just. Turning the IS “bs” around should not be our objective. We just want to eliminate being exploited. None of us wish to collect our fee and do an inept job. But we are fed up with an endless list of “additional requirements” that come with the package that were not disclosed when offered the assignment. When I mention this I am told it’s an IS. Well. My IS is to do what I agreed to do when setting my fee. Also the IS of “fee blackmailing” to require notaries to complete “I will be legally responsible if it does not fund” and similar nonsense is a thing of the past.

Most of us are one person business entities. We, lacking a true representative association that looks out for us; must form and enforce our own, fair, and just – Industry Standards.

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