Types Of eClosing And How They Work

The world is going digital and mortgages are no exception to this rule. You can upload everything from bank statements to W-2s via your tablet, computer or phone. Why not bring the closing process into the 21^st century? That’s the goal of an eClosing. Let’s go through the various types of eClosing and how they work.

An eClosing is a mortgage closing process that involves signing digital documents in place of paper ones. We’ll get into the different types of eClosing in just a minute, but it could be everything from a fully digital process when the notary connects with you remotely to a hybrid process where some documents are still physical.

As you can see, what eClosing actually looks like can mean a lot of different things, but your lender will walk you through what you need to know. If you’re a Rocket Mortgage^® client, one of our Client Care Specialists will let you know what to expect throughout the process.

The types of eClosing available to you will depend on whether you’re doing a purchase or refinance as well as where you’re located. State and local laws may vary. However, Rocket Mortgage offers hybrid eClosings in all 50 states.

eClosing comes in various forms, but we’ve created a graphic to help you keep them straight.

Hybrid eClosing

A hybrid closing involves signing some documents digitally while other documents are physically signed according to local law and mortgage investor policies. If you hear the term “wet signature,” that just means signing a document with a pen on paper. This is done in the presence of a notary.

In some instances, you may be allowed to sign the digital documents ahead of time to save time and provide for a smoother experience on closing day. If this is an option for you, you will receive communication in advance of closing.

In-Person E-Notarization (IPEN)

In an IPEN closing, all documents are signed digitally in the presence of a notary. The notary will bring a device that you can use to review and sign the necessary documents. This will often be a tablet.

Remote Online Notarization (RON)

During a RON closing, the notary is connected to you virtually via videoconference. All documents are again signed digitally. The big advantage of this is that you can literally be anywhere.

At this time, RON is available when refinancing as long as local law permits. If RON isn’t available in your area, the other eClosing options may be. Be sure to stay in communication with your lender.

Now that we’ve gone over the basics, let’s take a moment to answer some questions you might have.

When is a physical signature required?

Lenders, including Rocket Mortgage, are bound to follow local regulations. If your state or municipality says you need to physically sign something, we’ll make sure to get that signature. In other cases, states that allow IPEN or RON enable you to sign fully digital documents.

How does digital signing work?

For documents you digitally sign, there are several ways you might do so depending on the technology used for your closing.

• You might upload a picture of your actual signature.
• You could draw your signature using your finger, a stylus or your mouse.
• You may be required to type your name in a signature box.

Your closing agent will be able to direct you on how things will work.

Will my documents be protected?

We take the security of your information very seriously. Steps are taken to ensure that only those who need access to your closing package have it. Additionally, because the documents are digital, it prevents the possibility of physical paper being misplaced or lost.

What should I bring to closing?

This is just like a regular closing with the exception that at least some of the document signing is digital and it may take place remotely. You still need to be prepared on closing day with certain items.

Be sure you have a copy of your photo ID as well as the closing disclosure. Additionally, you’ll have the opportunity to have your attorney or whoever else you might want to look over paperwork with you.

Your lender will be able to tell you how to upload proof of insurance as well as how funding of down payment or closing costs will be handled.

How can I get more information?

eClosing is certainly more convenient than going through reams of paperwork. Whether eClosing is available depends on the type of mortgage transaction you’re doing as well as state and local law. The best point of contact for questions is your Client Care Specialist.

eClosing involves the signing of digital documents in order to reduce the amount of physical documentation associated with your mortgage closing. In the case of remote online notarization, videoconferencing means you don’t need to be in the same space as the closing agent.

The type of eClosing that may be available to you will depend on your mortgage transaction and laws in your area, but your Client Care Specialist will be able to walk you through the steps in the process.

Are you ready to move forward with your mortgage? You can apply online or give us a call at (833) 326-6018.