The Missouri Land Title Association recently held their Lobby Day in Jefferson City.
The Secretary of State’s office has filed legislation dealing with remote notarization known as HB495 and SB140. The MLTA cannot support this legislation unless it incorporates the provisions of our bill. Recently our team met with the SOS office to see if some compromise language could be reached; however, this does not seem to be an option.
Therefore, MLTA and MTLSG is working with the national Mortgage Bankers Association (MBA) and the American Land Title Association (ALTA) to enact legislation that would authorize remote online notarizations.
We urge you to consider supporting this legislation which was developed through the input of MBA and ALTA members and a wide group of stakeholders. The draft was also shared with the National Association of Secretaries of State, the Uniform Law Commission, Fannie Mae, Freddie Mac and the Federal Housing Administration.
MBA and ALTA collaborated in order to help offer a solution to the legal uncertainty their member companies face with respect to notarizing consumers’ real estate transactions remotely online through electronic technology.
That uncertainly stems from the lack of uniformity of laws enacted in a few states to permit these remote online notarial acts. For example, Virginia’s law was very permissive about where lenders, customers and property could be located and Montana’s law was much more conservative in establishing a very Montana-specific nexus in the transaction.
The ALTA/MBA bill provides consumers and the market clarity and certainty without offering an industry “wish list.” It is based largely on a 2017 statute enacted in Texas that was quickly emulated in Nevada. Both of these laws gave remote online notarizations the same legal recognition as in-person ones.
Additionally, the ALTA/MBA bill is similar to those two new statutes in three other key ways:
First, to protect against fraud, it requires the Secretary of State to promulgate rules to implement data standards and requirements related to credential analysis, consumer identification, data retention, privacy, security and other items. In fact, the Mortgage Standards Maintenance Organization (MISMO), has already convened a working group to produce suggested standards for Secretaries of State, to which the National Association of Secretaries of State has been invited to participate.
Second, the ALTA/MBA incorporates the principle of consumer optionality. No consumer would be forced to choose to close their loan using remote online means.
Third, the ALTA/MBA bill does not embrace technology standards specific to any one proprietary system. In other words, no single company would possess a monopoly on the state’s approved technology.
If the ALTA/MBA bill was enacted, it would set out a lengthy implementation timeline. This would not only allow ample time for a Secretary of State to draft proposed rules and receive expert input, but it would also give time for the real estate finance industry and consumers to prepare.
We believe that without the ALTA/MBA bill (having the SOS bill enacted), different state standards are likely to result. That outcome is the last thing consumers or the industry need, as it will lead to inefficiencies, additional costs and a poor customer experience.