Despite recent reports indicating that mortgage fraud is graduallydeclining in many parts of the country, the risk remains higher now than it was prior to the foreclosure crisis. With the industry working to implement new regulations and guidelines to prevent “robo-signing” and other types of misconduct, mortgage-related transactions and documents are under more scrutiny than ever before. Notaries and Notary Signing Agents continue to play a key role in helping to detect — and prevent — property fraud.
Notary educator Laura Biewer, an experienced Signing Agent, offers the following tips on how you can help prevent property fraud:
- Don’t Take Shortcuts: When it comes to identifying signers, there is no such thing as shortcuts. First and foremost, personal appearance is a must. Also, be sure to take your time when checking signers’ IDs. Always make sure the name on theacceptable ID matches the one appearing on the document being notarized. Follow the less, not more rule when it comes to matching names, and check to see that the names are ordered the same exact way on both documents (i.e., no reversed surnames).
- Follow State Notary Laws: While signing companies may offer their own instructions for Notaries, your primary direction comes from state law. If you have concerns about signers’ IDs, or whether the notarization request is acceptable, contact the NNA Hotline or consult your state’s law primer or state Handbook. You can also refer to the NNA’s Recommended Notary Practices if you have questions regarding proper Notary procedures. You might consider sharing this list — or your state Notary laws — with any signing company that asks you to break or bend the rules.
- Be Specific And Thorough: To minimize potential tampering with certificates, such as name changes, you can modify the statements to reflect the gender of the signer, rather than leaving it as she/he. Another way to prevent document tampering is by filling out the “optional” section on loose certificates, thereby using that space to link the certificate to the document and striking out any wording that doesn’t apply, so one else can fill it in later.
- Thumbprint All Signers: One of the best fraud deterrents is an inked thumbprint. Requiring thumbprints from signers for all required documents protects both you and the public. To date, only two states — California and Illinois, under certain circumstances — require thumbprints for real estate transactions. Even if your state doesn’t currently mandate the practice, the NNA recommends adopting it as an added safeguard. For more information on the California thumbprint law, check out the recent NNA webinar. [Note: Texas and North Carolina do not allow Notaries to take thumbprints.]
- Safeguard All Transactions: Do not send in a loose, corrected certificate upon request; you must meet with the borrower and re-notarize the original document. Also, do not include the extra certificate that is sometimes put in the package for the Notary. Only fill out certificates that are connected to the document.
Kelle Clarke is a Contributing Editor with the National Notary Association.