Getting documents notarized may seem like a pretty routine part of the job. After all, it’s a part of every buying or selling process, and it can be as simple as having your client take the documents to their local bank branch. But, like all aspects of buying or selling, there exist legal pitfalls that come with not following the letter of the law. Here, we break down the reasons why you shouldn’t take notarization protocol for granted.
Dropping off documents
It seems simple enough — your client is busy or out of town, and you want to help them stick to their desired closing date, so you get your clients the documents ahead of time. They can’t appear in front of a notary, so you pick up the documents and deliver them to the notary’s office with a copy of their identification to save time. But, beware. This simple act of assistance can land you in legal hot water. For a notarization to be valid, three things must happen: the signer must appear before the notary, present an ID, and sign the notary’s log book. If one of these ingredients is missing, the closing documents could be considered invalid under the law. Reputable lenders and title companies will not accept them, which means that in the short term, you risk having to move the closing date and signing all over again. In the long term, the consequences of improper notarization could be far more serious. Since asking a notary to put his or her seal on a document when the signer isn’t physically there constitutes a violation of Missouri law, you could risk losing your real estate license. Worse, if there were any legal action taken regarding your client’s sale or purchase, you could open yourself up to subpoenas or having to testify under oath about the closing documents.
Another way you may be tempted to try to save time for your clients is by having them pre-sign documents requiring notarization. If, for instance, they’re going to be especially busy the week of the closing, it would seem to make sense to have them sign on Wednesday, even though the closing isn’t until Friday, right? This is generally a great solution, but you will need to confirm it is acceptable to any mortgage lender. A properly pre-signed document is perfectly valid, and can be phrased to reflect an “effective date” at some point in the future. However – and this is the important part – the date in the notary acknowledgement must be the actual date the document is signed. The acknowledgement is effectively a sworn statement – so the notary must be able to accurately state, “On the 7th day of August, 2018, before me personally appeared…” If the person did not personally appear on that date, the notary has broken his or her oath, and the document could be invalidated in court.
In any case, the fact that the notary acknowledgement and document effective date does not in any way affect the validity of the document.
Avoiding notarization issues
The best way to make sure you and your clients never run into notary-related issues is to make sure to work only with notaries who follow protocol to the letter of the law, regardless of how inconvenient it may sometimes seem. Not all notaries necessarily follow these processes correctly, and that can create needless risk, both for you and your client. Making sure notarization is done correctly is just one more tool that you can use to your advantage to minimize risk and exposure.
If you have any questions about notarization protocol, the True Title team is happy to answer them for you.