Because of the COVID-19 pandemic, New York Governor Andrew Cuomo signed Executive Order 202.7 which legalized electronic notarizations for New York State. This action was swift and broad. With the ability to do business in person in New York suspended indefinitely for most industries, a bill was proposed in the Senate to legalize electronic notarizations. During the four months that we’ve been providing both online and in-person notarization services, we’ve found some notable differences between the two.
Remote Online Notarizations and Electronic Notarizations
First, there’s a difference between remote online notarizations and electronic notarizations. You will often hear the two phrases used interchangeably, but they are quite different. Remote online notarizations occur when all the necessary parties and witnesses are present in a remote video or other approved application and sign and notarize a document live. In an electronic notarization, a user or users and a registered notary are all in the same physical location and use a device such as an iPad, tablet, or computer to notarize a document rather than signing and notarizing physical documents.
Here are some more important factors we’ve noted during several months of preparing online notarizations:
Knowledge-based authentication is required by the new law! Knowledge-based authentication (KBA) uses third-party verification to confirm your identity. Users who wish to complete a safe online notarization are required to have a state-issued license, be a United States citizen, and have a credit history. As part of the process, primary signatories will be required to answer five identity-verifying questions in two minutes. While this can be a very thorough way to verify identity remotely, the technology still seems to be working through some glitches. If an individual fails a KBA, they will not be able to continue a notarization process. When notarizing in-person, all that is required is a valid identification document.
There are technology and equipment issues! Instead of focusing on the notarization, our agents have been more involved in providing technical support. Yes, when all the equipment is working properly, the notarization is smooth and successful. More often than not, however, inconsistent internet speeds and other factors have caused issues like delays and lag. Users have been unable to access microphones or cameras on their devices, or have been trying to access the interface with incompatible applications, devices, or browsers. Audio feedback resulting from users on separate devices in the same space have impacted sessions as well. Online notarization is a valuable tool but is still a work in progress.
Reviewing identification can be difficult. In addition to KBA, our notaries make a record of identification documents being used during video sessions. We’ve found that poor video quality can make it difficult to confirm an identity against an identifying document.
Only one original is available when notarizing in-person. With online notarization, each time a document is printed it’s considered an original. This is a significant benefit with powers of attorney, estate planning documents, and other common uses.
Online notarizations produce a video record. If a user needs to have a video record of their online notarization, it is easy and convenient for them to make or for our agents to provide - not necessarily so with in-person notarizations. Such records can be helpful with estate planning, real estate closings, and depositions. Cybersecurity can be a concern, however.
Online notarizations are more expensive and more time-consuming! One would assume that with the convenience of online notarizations would come benefits of time and cost. No transit or printing is required, after all. Technical issues that are not detected during the online session can make it necessary to repeat the process, however, leading to increased costs and consequential delays.
Online notarizations including large documents are prohibitively difficult! Many real estate closings, for example, can require witnesses, multiple signers, and over a hundred pages of documents. It can be extremely difficult for our agents to accurately review each page and oversee the correct signing. If a device or connection falters and any signer gets disconnected, the whole process needs to be restarted.
The necessary software is expensive! The software requirements for online notarizations are expensive and often don’t offer refunds. Larger notarization companies can use hundreds of notaries working as independent contractors and using a variety of different software interfaces to complete online notarizations. These notary agents are paying significant fees to use these platforms - up to $150 plus steep monthly fees. There are also costs for storing records, fees for using KBA, and the modest fees for the notarizations, in the range of $15 to $50. In the event of an unsuccessful online notarization session - one in which signers don’t pass the KBA, or there are technical failures - none of those fees are reimbursed to the notary. Online notarizations carry a very expensive learning curve!
Overall, online notarization is a valuable tool during a public health crisis such as the COVID-19 pandemic. But it is very new, there are growing pains as practice meets theory, and it is still developing. If you’re going to complete an online notarization, be sure to use an experienced and dedicated signing agent, such as Hudson Standard.
See my blog post on unanswered questions regarding the New York Senate Bill.
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