Nov 042016
 
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Signing Loan Papers

Notary Loan Signing Agent

There are mainly four types of loan closing document packages, with a few variations on each. Usually the bulk of signings will be refinances. The others will be purchase docs, seller’s docs, and HELOCs (Home Equity Line of Credit); and then there are construction loans, or other small loans that are secured by real property.

Refinance packages represent the bulk of the documents you will be asked to notarize.

Purchase docs have the same type of loan documents as refinance packages, unless the buyers pay cash; then of course, no loan is involved. There are some IRS forms to document the transaction. Sometimes there will be approval documents, like termite inspections, repair work completed as part of the purchase agreement, etc. These are usually approved or initialed.

Seller’s docs don’t involve any loan documents. This is usually a very small signing package. The most important part of this package will be the Grant Deed signed over from the seller to the buyer. There are also a few IRS forms to document income gained from the sale.

HELOC packages are just like other loan documents, but there is usually slightly less paperwork. Sometimes a regular refinance package will include a HELOC at the same time.

Not not every document mentioned will be found in every loan package, and lenders add new forms and documents to their packages quite often. Once you become familiar with the basic documents, you will be able to intuitively learn about any new documents you come across. And you can always ask the escrow officer about anything that isn’t clear to you.

There are many variables as to what forms and documents are included in a particular package. Some forms are required by law to be included in a loan package. Those required by federal law will appear in every package regardless of the state. Some states require certain documents that are unique to their state. Some types of loans require certain documents. Then the individual lenders have their requirements, the mortgage brokers, and finally the title/escrow company add to the mix. In general, some packages are smaller than others, usually depending on the lender.

Also, even within the required documents there are variations in appearance or title. In a short time you’ll be able to recognize what the documents are, in spite of how they look or what they’re called, once you begin to become familiar with the content.

You are expected to be knowledgeable enough about these documents to explain to the client in general terms what they are and why they need to be signed. A good practice is to explain documents only to the extent that the client wants an explanation. Many times people are already familiar and experienced with signing loan documents, and they only expect you to present each document for signature. These signings proceed quickly. This can also apply to inexperienced signers. A detailed, lengthy explanation of each document may only confuse them. It may be enough to simply present a document by its title, watch them sign, and go on to the next. But you do need to be prepared to answer questions and explain in more detail when necessary. You will learn to read people and what they expect. Learn all you can about these documents and practice presenting them in detailed terms until you really know them. Then, at the actual signing, go only as far as you feel the client expects you to, or is required in order to notarize.

One final word about the actual documents. Keep in mind that even at the end of intense study it will still take time and experience to really get familiar with each document and how to answer any questions that might arise.  Sometimes new documents are added, and possibly new policies on how to execute them. Never be afraid to simply and honestly tell a client if you don’t know the answer, but that you’ll help them find it.  Also be aware that no matter how well you do your job, you’ll sometimes come across problem people.  Some are just naturally grumpy.  Sometimes at this point they’re feeling stressed by the whole loan process.  Maybe their interest rate climbed higher than they expected before they could get it closed. Do your best, explain any important problems to the escrow officer, correct any errors that are in your power, and move forward.

 

Notary Loan Signing Agent Training

 

 

 

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Nov 012016
 
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The Loan Process

Notary Loan Signing Process

The more knowledgeable you are about the overall loan process the more comfortable you’ll feel when you perform your signings. Here is a very general outline of the loan process and the key players to show you where you will fit into the big picture.

Borrower: The person or persons applying for a loan. This will usually be for the purchase of a home, to refinance an existing home loan, for a second mortgage or home equity loan.

Broker/lender: A borrower applies for a loan through a loan broker or directly to a lender, such as a bank or credit union. Borrower information is collected on a loan application, and the qualifying process begins. The broker/lender matches the qualifications of the borrower to an appropriate loan. The borrower will make payments directly to the lending entity.

Escrow/title Company: An escrow is opened by the broker or lender with a title or escrow company. The title/escrow company performs a title search to make sure the title to the property is clear of any liens, and then issues title insurance and a Preliminary Title Report. The escrow company is also the guardian of any funds from any parties to the transaction that are to be held in escrow during the closing process and then disbursed at closing.

Closing: The title/escrow company arranges for the borrower to finalize and sign the paperwork required by the lender. This is the precise moment the signing agent enters the picture to perform the loan signing. After all signatures and notarizations are performed and any rescission (right to cancel) period has elapsed, the Deed of Trust is filed with the county recorder’s office. Finally, the escrow funds are disbursed to the proper payees (including your signing fee), and the process is complete.

The escrow officer or their assistant is the person the notary signing agent will most likely be dealing directly with (unless you’re working through a signing service). The escrow officer’s job is to coordinate the loan closing by following the lender’s specific instructions, gathering all necessary information, arranging for title insurance, collecting any funds to be held in escrow, disbursing the funds from escrow, verifying that hazard insurance on the property is in effect and in the proper amount, and that property taxes have been paid. They also perform many other tasks.

The escrow officer often performs the signing themselves (sometimes called sign-up), but sometimes they or their assistant will arrange for a notary signing agent (you) to do it, especially if the signers/borrowers reside out of town or out of state, or want a notary to come to their home or office.

In the lender’s closing instructions, the escrow officer is referred to as the “closing agent,” even if a notary signing agent conducts the signing for them. The signing is just one part of the whole loan closing process, and not the actual “closing,” which happens a few days later after the recision period and other closing activities are finalized.

NOTE: If you work through a signing agency, you probably won’t be dealing directly with any escrow officers. The signing agency will send you on assignment to perform the signing and then pay you directly.

 

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