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We’ve fielded numerous calls from Realtors asking: What can I do if my client is sick and can’t come to closing?

The answer depends upon whether the party is the buyer or seller and whether the parties planned ahead.

Sick Sellers

Many title companies can accommodate the seller with an e-closing using a Remote Online Notary (RON). Homestead has conducted a large number of Seller e-closings (some sick and some practicing social distancing). Sellers need a computer with Google Chrome or Firefox, a webcam and microphone, and a decent internet connection.

In additions to an e-closing, some sellers may be able to pre-sign documents and have an attorney they know “authenticate” their signatures.  In rare cases, our attorney will authenticate their signature if he is either familiar with them from past transactions or has  had a video conference signing along with another party familiar with the seller.

If e-closing is not an option, the Seller may be able to use a Power of Attorney (See Below).

Sick Buyers

Sick Buyers can present a bigger challenge.  Lenders are not yet ready to allow fully digital closings and we generally need in-person, ink signatures. The big exception: Cash Buyers can sign remotely without needing a digital notary.  The vast majority of buyers have financing and will need another option.

  • Power of Attorney:  This option works best when the POA is already in place.  It is not ideal when first addressed with a sick party because it may require that they visit a notary in person. POA’s present a few issues:POA2
    • Visiting a Notary: Some real estate professionals have recommended that sick Buyers have the POA notarized at a Bank drive-through.  This seems unfair to the bank employees and socially irresponsible.
    • Authentication by an Attorney:  A safer option is to ask if the Buyer has an attorney who can “authenticate” their signature without the Buyer being physically present. We may be able to accept a scanned copy of the authenticated signatures along with a mailed original at a later date.
    • Remote On-line Notary: A third option is to see if the lender will accept a digital, RON notary for the Power of Attorney. This is a long shot but worth a try.
    • HEALTH WARNING:  We are very cautious about working with a power of attorney appointed by someone known to have Covid-19. Most people appoint someone they know well and we need assurances that the Signing Agent has not been in contact with the sick person in the last 14 days.
  • Delay:  If the parties have not contemplated a delay, they will need an Amendment to allow for an extension of time to close.  Many parties have planned ahead and included extension terms in their offer.  The Wisconsin Realtors Association (WRA) released Addendum CV to address Covid-19 related issues. The Addendum allows for extensions of time if a delay is caused by:
    • Office closures such as banks, title companies, register of deeds, appraisers, etc. or
    • Sickness, isolation, or quarantine by any party.

Please let us know of any sick party as early as possible.  Homestead will work with you to find safe, healthy, and proactive solutions.

Planning Ahead

The best plan is one that is already in place. Parties should discuss the benefits and drawbacks of Addendum CV with their Realtors or attorneys.  In addition, parties may consider appointing a power of attorney (who does not live in their household) in case they are unable to attend closing.

Finally, planning for health challenges is something everyone (not just Buyers and Sellers) should consider, especially in times of uncertainty. It is wise to have a will, power of attorney, and power of attorney for health care. A power of attorney for a real estate transaction only allows someone to sign closing documents. A power of attorney for health care is far more important. It allows your agent (a loved one) to make critical health care decisions that are consistent with your wishes in the event that you are unconscious or incapacitated.

Homestead Title can draft a general Power of Attorney.  We cannot advise you on wills or drafting a Power of Attorney for Health Care. Attorney Peter Zarov, however, can consult with you about these needs to provide assistance or referrals.

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To protect the safety and health of our customers, clients, and staff, Homestead Title has made some significant adjustments:

  • We offer Digital, E-Closings to Sellers and Cash Buyers
  • We are handling in-person transactions as “Drive-Up Closings”

So, how well are these working? 

Digital, E-Closings

We’ve handled many digital closings over the last week and the reviews are positive.  Closing from home is obviously convenient and safe. And the time it takes to close is similar (actually a little longer to authenticate identities). Yet, just as working from home can be awkward and less efficient, so too are digital closings.  The technology is good and easy, but not perfect.  Voices sometimes echo or lag, video can cut out, and explaining documents is slightly harder. Anyone who’s participated in Zoom or other video conferences knows what we mean.  Given our current circumstances, the positives far outweigh the negatives.  In normal times, this will be one more tool in our tool-kit, but will not replace in-person closings.

Drive-In Signing

driveinHomestead Title is handling all in-person transactions at our WEST office as “Drive-Up Closings.” We’ve received fantastic responses as customers appreciate our efforts to protect their health. And, the process has worked very well: Customers call when they arrive, we bring documents and a clipboard, and they sign in the car.  Customers take a little longer to sign. And we answer questions from 6 feet away or by phone.  We can’t wait to return to the closing room, but we’re proud to keep our customers and team safe.

With both Drive-In and E-Closings, we are offering to send all copies via secured, encrypted email.

Some of these adjustments are temporary.  In healthy times, we will not be doing “Drive In” closings — if we do, we’ll serve burgers and shakes on skates!  We likely will handle more e-closing when things return to normal. Yet, we anticipate most closings will return to the closing room with happy buyers, sellers, Realtors, and lenders celebrating together.

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Homestead Title will be taking extraordinary measures to protect the health and safety of our customers, clients, and team.

Remote Staff: More than 85% of our team are working remotely from home.  We have had remote capabilities for over 15 years and you may not notice a difference.  We still ask for patience and understanding as it is hard to work with co-workers who are toddlers, pets, and family.

Driveup2Drive-Up Signings: All in-person transactions will be “Drive Up Closings” at our WEST office until Wisconsin’s Emergency “Safer at Home” Order expires (currently set for April 24). Here’s what you should know:

  • In-Person Signing at 555 Zor Shrine (WEST): All closings will take place at our West office as “drive up closings.”
  • Strict Lock-down of our Office: We are not admitting anyone into our office other than essential staff.
  • Alert Us When You Arrive: Call our main number and we will have our closing officer come right out to your car with documents to sign.
  • Only Signers at Closing: We urge only signers come to Drive-Up Closings. Others can come, but they will not be allowed in our building and will be asked to stay in their cars in the parking lot.

E-Closings are hereDigital Closings: We can do fully digital, remote closings for Sellers or Cash Buyers. The mortgage industry is moving fast to add financed buyers, but we are not yet aware of any Banks or Credit Unions that can do a fully remote closing.

Our mission statement is to make the closing process easier, smoother, and less stressful for our buyers and sellers. For the next few weeks or months, we need to add: “… and safer.”

 

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The self isolation and quarantines of the coronavirus/Covid-19 pandemic creates challenges and disruptions, including in real estate.  The title and mortgage industries are putting forth efforts to overcome these challenges.

Remote Digital Closings May be Available Soon!

A major effort is underway from title underwriters, legislatures, and administrative agencies to allow “Remote Online Notaries,” (RON) in Wisconsin.  This would allow for fully remote, digital closings without the need to leave home. While it would primarily be available to Sellers, some Buyers can also sign remotely.

E-signing2

Buyers with a loan will need their lender approval to conduct a fully digital closing.  Lenders have many considerations and challenges, including investors, underwriters, mortgage insurance, and legal issues. Some may not be able to offer this service right away and others may allow only certain documents to be signed digitally.

Homestead Title is already conducting digital, remote closings for “Cash” Buyers (where none of their documents are notarized and there is no lender).

Look for important updates on Digital Closings in the coming days.

 

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Homestead Title has implemented a plan to maintain day-to-day operations in response to the Coronavirus (COVID-19) pandemic.

Homestead will continue normal operations, without disruption, during these challenging times. We do not anticipate any delays or cancellations as a result of temporary changes to our business. The majority of Homestead’s team will work remotely from home over the coming weeks. Phone and Email will operate as normal and we are available to help.

Closing officers will be available in our office for any scheduled sale or refinance. We will operate with minimal, in-office staff and appreciate your patience and understanding.

We are committed to supporting and serving our employees, their families, and all those involved in our real estate and title insurance transactions.  As we monitor developments and guidance from public health professionals, we will make any necessary adjustments.

Tips for a Healthy Real Estate Closing:

  1. Only Signors in the Closing Room: Homestead will not allow anyone in the closing room other than necessary signors (Buyers, Sellers, and their attorneys).  We urge Lenders and Realtors not attend closing and will ask them to wait in our outside lobby.
    1. We will include Realtors and Lenders on all questions by phone.
    2. We will overnight commission checks at no cost to the Realtor or their broker.
  2. Sign Separately and Social Distancing: We encourage Buyers and sellers to sign at different times.  We are waiving Seller pre-sign fees until at least June 1, 2020.  Alternatively, we encourage Buyers to arrive on time and Sellers to arrive 35 minutes after the start of closing.  This will allow for minimal contact and more “social distancing.”
  3. Remote or Digital Closings: When possible, Homestead will offer remote or digital closings.  Remote notarization is not yet legal in Wisconsin, so fully digital closings are rarely an option other than for cash purchasers. We will explore all options to accommodate our customers and protect the well-being of our community.
  4. Clean Office Space:  We are providing clean pens and separate paperwork to minimize contact between people. We are wiping down all surfaces with disinfectant wipe throughout the day.
  5. When to Avoid Closing: If any Buyer or Seller is sick,  in contact with anyone diagnosed or suspected of having Covid-19, or has traveled internationally in the last 14 days, please contact us for alternative closing options
  6. Celebrate: We are excited to help you buy, sell and refinance. Yet, we will be refraining from hand shakes, high fives, and other close celebrations.  These are scary times, but together we can do this!

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Is it time to refinance your mortgage?  Probably!

The rate on a 30-Year Mortgage has steadily dropped from already low rates. Although rates can vary by region and lender, the national average has dropped from  nearly 4.5% to under 3.5% over the last 6 months.

Mortgage Rates

The drop in mortgage rates corresponds with a recent drop in the 10-Year Treasury Bond.  The market for these bonds does not directly effect mortgage rates, but it is good indicator of their direction.  In fact, movement of the 10-Year Treasury Bonds almost exactly mirrors movement of 30-Year Mortgage rates over the past 5 years:

COMPARISON

As of February 24, 2020, the yield on the 10-Year Treasury bonds were near record lows.

Does this suggest record low mortgage rates?

Yes!  The current mortgage rates are already near record lows.

Will mortgages rates drop further (don’t they drop when the bonds drop)?

Not Necessarily.  Mortgage rates are not directly effected by bond rates — there are many factors that determine mortgage rates.  And, a drop in bond rates may reflect market conditions that are already “baked in” to current mortgage rates.

The recent precipitous drop in bonds may be largely a reaction to the coronavirus, and fears of its effects on the global economy.  Yet, those fears and the current bond yields at least hint at a continuation of low rates, if not a drop in rates.

Disclaimer – if we could predict where mortgage rates will go, we would be on a tropical beach, not writing this blog.  Rates could go up or down. Mortgage rates are already CRAZY LOW and its probably time to refinance if you haven’t already!

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Imagine signing all of your closing documents for the purchase or your house from the comfort of your couch.  Digital closings are coming and this could soon be a reality.

What is a Digital Closing?

A digital closing is a broad term that can include a number of differedigitalnt scenarios, ranging from the review and signing of a few documents on a computer or tablet to signing all documents remotely on a computer. A digital closing simply means a closing where at least some documents are signed electronically.  There are 3, broad categories of digital closings:

Hybrid Closing:  Some documents are signed electronically while others are signed on paper. This typically occurs in person, at the title company, and may include a traditional notarization or an electronic notarization.

Fully Electronic Closing:  All documents are signed electronically, including the use of in-person electronic notary.  The closing occurs in-person, usually at the title company.

Remote Electronic Closing:  The entire closing occurs remotely, via video, with a remote online notary (RON).

So, when can we do an electronic closing?  Some Hybrid closings are already happening. But, there are still challenges before the industry can implement more extensive use of electronic or remote electronic closings. These challenges include technology of lenders, title companies, and consumers; security and privacy concerns; and the interaction of state and federal laws.

Homestead Title recently participated in the American Land Title Association and Mortgage Banker’s Association’s Digital Closing Boot Camp.  Our take away: Digital closings are coming, but not tomorrow and not in a tidal wave.  Digital closings will soon become another tool in our tool box, giving consumers more options. Remote Electronic Closings are a more distant reality in Wisconsin.  Most importantly, we learned that Homestead Title is more prepared than most in the industry.

Look for more information about digital closings and options to make the closing experience easier, smoother, and more convenient.

 

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