Decoded: New Standards For Mortgage Signings
Throughout the past few years, the mortgage industry has been under increasing scrutiny from the federal government and regulators. While banks and lenders have had to make significant changes to their businesses, little attention has been given to the role of notary signing agent.
Recently, NNA has teamed up with leading lenders and title companies to create a special committee called the Signing Professionals Workgroup (SPW). The group created a “Certified Signing Specialist” distinction which puts forth a certification for notaries who have followed the SPW’s recommended best practices for handling loan signings.
NNA’s CEO gives some insight into the motivations behind these new notary standards, “Signing Agents often have had to meet widely varying requirements and qualifications from one company to another,” said NNA President and CEO Thomas Heymann. “The Standards and new Certified Signing Specialist designation are intended to provide a set of qualifications and practices for everyone. Ultimately, they should help reduce the number of different requirements Notaries face to keep getting loan-signing assignments.”
What are the new standards?
There are five standards that a Certified Signing Specialist must uphold:
- 1.) The Certified Signing Specialist Code of Conduct*
- 2.) Standardized signing script
- 3.) Annual examination
- 4.) Annual background screening
- 5.) Notary errors and omissions insurance
The Certified Signing Specialist Code of Conduct includes over 100 individual standards of practice. These standards are broken up into 10 guiding principles. Find more information on the standards and a link to the code of conduct here.
Notaries that wish to become a Certified Signing Specialist will also have to pass an annual exam created by the Signing Professionals Workgroup with a score of 80% or better.
In 2010 Congress passed the Dodd-Frank Act, which among other actions created a new federal agency, the Consumer Financial Protection Bureau (CFPB), created to regulate all types of financial institutions.
In July 2011 the CFPB created a consumer compliant system that received over 85,000 mortgage-related reports from angry and upset borrowers through June of 2013. As a result, the agency issued thousands of new regulations and brought numerous enforcement action against lenders and other financial companies costing them over $750 million.
In April of 2012 the CFPB issued a bulletin regarding service providers that caused lenders and title companies to take notice of what was occurring at the signing table. NNA President and CEO, Thomas Heymann explains, “Lenders are being held accountable for the actions of their outside service providers, such as title companies and whoever they hire — including Signing Specialists.”
These new standards have been incorporated into many contracts between banks and title companies, which in many cases, pushes the responsibility onto the signing service to ensure contracted notaries are in compliance.
You can find more details on the new Certified Signing Agent distinction and the best practices advocated by the SPW in NNA’s article here
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