After issuing a statewide stay-at-home order restricting trips out of the home with the exception of “essential” purposes, Gov. Larry Hogan authorized Monday the use of technology to facilitate real estate closings and document notarization.
The decision, which thousands called for in a online petition earlier this month, now allows individuals who perform “notarial acts” to conduct services with real time, visual communication devices after verifying their identification with a “government identification credential” such as a driver’s license or passport.
The announcement comes as a relief for many in the state’s real estate and title industries, who previously implored the governor to deem the industry as “essential” but also sought ways to limit employees’ contact with others amid the coronavirus outbreak. The highly contagious upper respiratory disease, which according to Johns Hopkins University has sickened over 800,000 people worldwide and killed some 39,000 patients in its wake, continues to wreak physical and financial havoc as it overwhelms hospital systems and slows down the global economy in tandem.
Much of Maryland’s workforce had already transitioned to teleworking. But Maryland real estate professionals worried that state law allowing electronic procedures — set to go into effect in October — would not be made available to them in time to prevent the disease from spreading across their industry and to their clients.
“We are deeply concerned about the health and safety of our members and everyone involved in real estate transactions,” said Mark Glazer, executive director of Maryland Land Title Association, in a March 25 interview. “We’re all in uncharted territory right now.”
Electronically-conducted settlements, closings and document signings would ease some of the stress on buyers, sellers and industry professionals, Glazer said. Legislation allowing for virtual transactions of this nature passed in the Maryland General Assembly in 2019.
Last week, the state said it had no plans to offer a workaround for in-person settlements.
“At this time, we do not believe there is a way around the legislature’s intent to have remote notarization take effect on October 1, 2020,” said Hogan spokesman Mike Ricci in an email.
Ricci did not say why the state would be barred from advancing the legislation ahead of schedule. An email from Maryland Secretary of State John C. Wobensmith said his office is developing education materials and guidance for notaries consistent with the legislation that would be ready by October.
Monday’s authorization, though, takes effect immediately, and remains effective until the termination of Maryland’s state of emergency, according to a copy of the ordinance.
Industry professionals said enabling electronic closings allows them to continue working at full strength for the duration of the outbreak. Sherman Hardy, a Prince George’s County real estate agent, started the online petition calling on the Hogan administration to enable electronic closings to begin immediately. Hogan, a real estate professional himself, should understand the gravity of the moment and the unique challenges facing those in the field, Hardy said.
The petition amassed over 20,000 signatures in about a week. Hardy said the groundswell of support signals how many people stand to benefit from the legislation’s proposed advancement.
“This will allow us to continue doing business as usual during these hard times,” he said. “We might not be at the forefront of everyone’s minds but we have to remind the government not to forget day-to-day minutiae.”
Electronic settlements can also benefit those working overseas or those in the military who seek to buy and sell properties abroad, Hardy said, but often cannot participate in property sales .
Usually, when real estate transfers from one owner to another, buyers and sellers confer in person to sign and verify paperwork with a licensed title professional or a notary public. Real estate agents, lenders, builders and friends and family often join in to watch the settlement, which industry professionals consider the final step of the home buying and selling process.
But as the coronavirus and the legally-enforced social distancing orders designed to curb it upend daily life, title companies across Maryland have scaled back on their travel and limited the number of people they allow into their conference rooms every day.
Per the order, notarial acts must be recorded and marked as electronically conducted in a certificate or journal.