First 100% Virtual Paperless Closing of an e-Mortgage in North Carolina

On May 5th, North State Bank successfully launched its eMortgage platform with the first eClosing of an eMortgage where the attorney conducted the closing by virtue of video conferencing technology.  While there have been previous eClosings and eMortgages in North Carolina, this marked the first time that 100% of the necessary elements were digital.

Elaine Marshall, the North Carolina Secretary of State, was on hand to witness this step into the future.  In her comments about the historic eClosing, she specifically remarked that the following North Carolina requirements were met:

  • eNotary was physically present at the closing; and
  • A North Carolina licensed attorney was present at the closing (with the aid of modern video conferencing technology).

“For eClosings we [North Carolina] require[s] the physical presence of that notary plus the access to legal expertise—there is zero drop in standards for an eClosing—it is just faster, far more convenient and in my opinion more secure. . . . The eNotary is essential to moving legal filings into the digital age.  People and institutions still want to know that a notary was there in the room confirming the signer’s identity . . . ”

The North Carolina Secretary of State is the primary regulator for the state and as such has developed the standards and education curriculum for eNotary or electronic Notary. An eNotary can attach a digital representation of their notary seal and signature to digital documents, giving the documents the same legal effect as a paper document that requires a notary acknowledgement.

The Secretary proclaimed North State Bank’s eMortgage program to be a success and a big step forward in the Secretary’s ePilot Program for eMortgages.

 “This is a win-win-win scenario.  The lender gets their work done quick and easy, the borrower gets in and out on a schedule that fits for them, and the land records get recorded instantly at the county register of deeds. . . . We stand ready to work with all other North Carolina lenders to get them up to speed on this.”

The President of North State Bank, Ken Sykes, was also on hand to witness the culmination of North State Bank’s year-long effort and the state’s step into the future of residential lending.  The eClosing ceremony was performed by Ben Drayton, of the Hunoval Law Firm, via video conference from his office in Charlotte.  The borrowers, who were present (together with the eNotary) in the North State Bank branch in Hickory, reviewed the documents with counsel on a big screen television and executed the documents on digital pad.  Steven Brown, Vice President for Investors Title, monitored the eClosing on the part of Investors Title, which insured the transaction.

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