Oklahoma’s Remote Online Notaries
In 2019, Oklahoma’s legislature took a significant step in moving Oklahoma toward all digital and paperless closings with Senate Bill 915. This legislation established the following in Oklahoma:
(1) 16 O.S. § 87 on the recording of natively electronic documents in tangible form;
(2) 49 O.S. §§ 201 et seq.: The Remote Online Notary Act. Additionally; and
(3) Title 655, Chapter 25, of Oklahoma’s administrative code: Rules and Regulations promulgated by Oklahoma’s Secretary of State
Oklahoma’s legislation is very similar to the Remote Online Notary legislation passed a year earlier in Texas. Both states’ laws and regulations are based off of the model language developed by the American Land Title Association and a banking industry group. Here in Oklahoma, the Oklahoma Land Title Association (disclaimer – I’m a member and supported SB 915) and various realtor interest groups worked together on pushing for Oklahoma’s adoption of this legislation. I think it is important to keep in mind that this legislation was geared toward notarization of deeds, mortgages, and other instruments executed as part of real estate transactions. When these new laws became effective on January 1, 2020, many of us in the real estate industry were expecting a gradual adoption of these practices by younger home buyers demanding digital closings. However, the spread of COVID and the impact of social distancing are driving a much quicker adoption of Remote Online Notaries than any of us expected when we first started talking about this bill.
The new statutes and accompanying regulations are dense and technical. I’m not going to try and explain every nuance of them here. My goal is to provide a basic understanding and framework. If you decide to use Remote Notaries as part of your practice or business, please do full due diligence on your own before implementing those changes. I am happy to assist with this process as your attorney.
A regular notary is not automatically authorized to do Remote Online Notarizations in Oklahoma. Pursuant to the new statute, you must first be a regular Notary Public in Oklahoma to register with the Oklahoma Secretary of State as a Remote Online Notary. The Secretary will charge a registration fee for this.
The most important key to remember with RON is that the Remote Notary must be located in the state of Oklahoma. The person signing the instrument may be located in any other state or US territory (there are some specific rules if the person signing is in a foreign country), but the Notary must be at a computer in Oklahoma. This is an Oklahoma law, governing the actions of Notary Publics in Oklahoma. In addition to this statutory rule, I am hearing from title companies as they develop their RON procedures and guidelines that they want the land to be located in the same state where the Notary Public is licensed. So for real estate transactions closing in Oklahoma title offices, you’ll need a Remote Online Notary in Oklahoma and real estate located in Oklahoma, but the signor on the deed or instrument, can be located in elsewhere when they execute the deed before the Remote Online Notary.
If you take a look at the statutes and regulations, there are a lot of requirements to perform a Remote Online Notarization. Remember that the model legislation that Oklahoma’s RON is based off was designed to satisfy the underwriting and security standards of mortgage lenders and title insurers. This is a lot more complicated than having a signor and a RON join a Zoom or Skype session and simply watch a person sign a deed. The regulations require “Credential Analysis” and “Dynamic knowledge-based authentication assessment.” Additionally the RON’s electronic seal must be “tamper-evident technology” consisting of a digital certificate that complies with the International Telecommunication Union’s X-509 standard. Also, the regulations require digital storage of the video record of the online notarization for a period of 10 years. These are complicated requirements designed to ensure the authenticity of Remote Online Notaries. These are good measures that should make the rest of us feel safer and more comfortable relying on instruments in the record that have been acknowledged used RON; however, they also form a barrier to solo practitioners and small offices performing RONs.
Based on my preliminary experience with RON, I think the best option for people similarly situated to myself, i.e. solo practitioners, small law firms, real estate agents and investors, is to work with a third-party vendor. These vendors, such as DocVerify and Notarize.com (this is not an endorsement, I just know these are two services that people in Oklahoma have used), will, if they’re compliant with Oklahoma law, ensure that all of those technical requirements are met. According to a presentation I listened to by the founder and CEO of Notarize.com back in February, they will take care of storing the video and all of the other records. I am not personally set up yet for RON, but I assume that these services will charge you a fee, but I imagine that the fee will be substantially less than employing computer programmers or coders to develop your own platform and records retention system for RON.
While individuals and small businesses will probably need to rely on third-party vendors, I imagine we’ll see the larger title companies and banks develop their own internal platforms for remote notarizing their customers’ documents. It is worth noting that despite the involvement of banking industry groups, some banks, most notably Wells Fargo, are requiring their mortgages be executed in front of in person notaries still (writing this on 4/2/2020).
The COVID pandemic has people scrambling for new ways to execute documents without coming into physical contact. Oklahoma’s new RON bill may supply some help, but it’s a complicated tool that is going to take some getting use to and may not be appropriate in all situations. Unfortunately, it appears that RON is not going to provide an easy solution for documents that also need to be witnessed. While a Remote Notary could theoretically notarize the signatures of the testator and the two required witnesses on a will, the law on will executions requires the testator to sign in the physical presence of the two unrelated witnesses. Laws like that were not updated as part of RON, meaning, it appears that under Oklahoma law, the two unrelated witnesses would need to be physically present with the testator, which poses a challenge with social distancing and self quarantining.