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NASS Adopts Standards for Online Notarization

We’re thrilled to announce that today, the National Association of Secretaries of State (NASS) officially adopted standards for online notarization. The new standards are a huge step forward – providing clear policy and regulatory guidance for the effective operation and regulation of online notarizations. It puts notarizations conducted online on par with in-person paper notarizations for acceptance by key regulators. The standards are consistent with laws adopted in Virginia, Texas and Nevada, which Notarize helped craft, as well as legislation currently pending in more than nine states with our support.

The role of NASS: How Secretaries of State Impact Electronic Notarization

Secretaries of State are the commissioning authorities for notaries in nearly every state across the country - empowering notaries with their authority to perform a notarial act. They also play a critical role in setting regulations and implementing policy relating to notarizations, including everything from how a notary must verify the identity of a signer, to the fees they can charge, and the records they must keep.

Secretaries of State are also commonly the first line of defense when a question arises, are responsible for enforcing the rules, and verifying the authenticity of notarial acts conducted by notaries in their respective state. As such, it’s paramount they set standards for the proper execution of online notarizations so the public can trust and rely upon them as they do standard, paper notarizations.

NASS is the trade association and standards setting body for all 50 Secretaries of State, DC and the US territories. Back in 2006, years before online notarization was contemplated or authorized, NASS adopted standards for electronic notarization. The standards, at the time, allowed for documents to be signed electronically on a tablet or computer, but much like traditional notarization laws, still required in-person appearance in physical form to verify identity. Thus, electronic notarizations were only partially digital.

Unfortunately, electronic notarization was never widely adopted as it didn’t provide the experience, efficiency, security and verifiability that consumers, businesses and regulators expect. Imagine if the eSignature products you use everyday required someone driving a tablet to your home?

In recognizing these shortcomings, states have adopted new laws allowing for personal appearance in a notarial act to be accomplished via live audio-video communication online. Virginia, possibly the greatest state, was the first in 2012. But NASS’ electronic notarization standards hadn’t caught up – until now. Today’s decision brings NASS’ position inline and clarifies any remaining doubt that presence during a notarization can be accomplished by means of a secure audio video session, finally making electronic notarization truly digital.

Moving Notarization into the Future: How We’ve Led The Way

Despite the fact that online notarization had been legal for almost 4 years, when we launched Notarize in February 2016, there was very little adoption and even less understanding of online notarization in the Commonwealth of Virginia, let alone throughout the country.

In fact, when we first visited the Secretary of the Commonwealth of Virginia and the Attorney General to demonstrate our product and service, they indicated that there were fewer than 10 actively commissioned electronic notaries in the entire Commonwealth (out of over 160,000) and no one could confirm whether a single online notarization had been completed in compliance with the regulations promulgated by the Secretary’s office.

 

Notarize_Pat Kinsel and Adam Pase at Virginia Capitol. Online Notary
Adam and Pat in front of Virginia Capitol, 2015

 

"When Notarize first came to our offices in 2015 there was very little understanding and adoption of this process within the Commonwealth. The launch of Notarize the following year not only spurred interest throughout the stakeholder community, but it represented the first opportunity to operationalize Virginia's law to meet its intent of providing citizens with a more efficient, secure, and verifiable form of notarization.

Since that time we've worked closely with Notarize to educate stakeholders across the Commonwealth and in other states to ensure acceptance of documents notarized by duly commissioned Virginia notaries throughout the U.S. and the world. I am so pleased to see that NASS has now recognized these efforts by adopting standards for online notarizations that provide further clarification and recognition of this process throughout the country. I look forward to continuing our work to modernize the notarial process and empower our notaries in the Commonwealth to meet the needs of the new economy," said Secretary of the Commonwealth of Virginia, Kelly Thomasson.

 

Notarize_Pat Kinsel Levar Stoney Online Notary Demo A screenshot from our demo with Levar Stoney, then Secretary of the Commonwealth of Virginia. Current Secretary Thomasson is just offscreen. December 2015.

 

When we started, online notarizations were seen as “less than” the traditional method. We believe our demonstrations helped people understand why online notarizations are not only more convenient, but also a more reliable form of notarization for all relying parties.

When we launched Notarize, then Secretary of the Commonwealth Levar Stoney (currently mayor of Richmond, VA) stated that “online notarization offered a more convenient, informed, and secure solution” and that, “with the launch of Notarize, Virginia is on the forefront of this transformation.” We made a commitment to the Secretary’s office to operate to the highest standard of the law and that we would dramatically lift the public’s awareness of legal online notarization.  We also committed to take it upon ourselves to educate all key stakeholders, including other Secretaries of State, real estate practitioners including realtors, title agents, banks and mortgage lenders, notary associations, county clerks, bar associations, and many others.

In February 2016, just weeks after publicly launching our product into market, legislation was introduced in Maryland to authorize online notarizations and put them on par with their peers in VA. Pat and I were asked to testify in front of the legislature in support of the bill. There was strong interest in the legislation, but concern about the acceptance of online notarizations by key organizations like Fannie Mae, Freddie Mac, and the National Association of Secretaries of State kept it from passing. This doubt was seeded largely by the NASS standards on electronic notarization that had been passed in 2006. We left Maryland determined to convince each and every one of these organizations about the benefits and validity of online notarization.

 

Notarize_Pat Kinsel and Adam Pase Maryland Online Notary testimony
Adam and Pat in Maryland Capitol before testifying

 

We reached out to NASS in March of that year to engage and joined as a corporate affiliate. And, we hit the road, traveling to more than 20 states across the country in just ten weeks to meet directly with Secretaries of State. We had nothing to sell, only to provide research and education on online notarization and to create a platform where we could learn from each other.

In April 2016 [just two months after the public launch of the Notarize platform], NASS launched the Remote Notarization Task Force and we joined as one of the first three private sector advisors. Over the course of the nearly two years of the Task Force’s existence, we’ve presented twice in front of the Secretaries, our General Counsel Michael Chodos has met directly with more than 40 Secretaries, and we’ve participated in countless meetings with both the Secretaries and Notary Public Administrators. This has been an incredible learning experience for us and has ultimately made us a better and more informed company.

Continuing to Move the Industry Forward

We’ve continued that educational and advocacy effort and it’s a core part of our culture. Beyond NASS, we’ve presented to hundreds of county clerks, the CFPB and several other Federal organizations.

Fannie Mae and Freddie Mac now accept Notarize, we were the first and are still the only company to deliver electronic promissory notes executed online to either. We were also the first company to gain title insurance for mortgages executed entirely online. We Co-Chair the Property Records Industry Association’s Interstate Recognition Committee, Chair ESRA’s eNotary Policy Committee, and Co-Chair the Mortgage Bankers Association’s MISMO Online Mortgage Standards Committee.

Recognizing our mission and perseverance to power the future of notarization, the National Association of Realtors invested in Notarize, actively supporting the concept broadly and our platform specifically. Last year, both Texas and Nevada passed online notary legislation. Notarize was the only technology company to advance the Texas legislation alongside Mid America Mortgage, the Texas Land Title Association, First American Title, Chase, Wells Fargo, the Texas Bankers Association, and Texas Mortgage Bankers Association. The same is true in Nevada. Today, MBA and ALTA now support the Texas Bill we helped to create as model legislation. We hope their support alongside NAR and others will lead to the passage of online notary bills in numerous states this year.

As states enact online notary legislation, they’re looking to NASS to provide a model regulatory framework. With NASS’s adoption of online notary standards today, the organization is providing much needed guidance to the states, technology platforms, and to industries that rely upon notarized documents. We appreciate the hard work of all the staff at NASS, the Secretaries on the Task Force and those in the offices of the Secretaries of State who have committed their time and expertise to these discussions.

Today marks an incredible milestone for Notarize and the industry at large.

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You have notarization questions, we have notarization answers. While we at Notarize pride ourselves on providing helpful resources (like this blog!) to demystify notarization, we’re not lawyers and don’t give legal advice. Pro tip: always check with your own attorneys, advisors, or document recipients if you have further questions about notarization or digitally notarized docs.

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