I was recently contacted by an acquaintance who had a question about electronic signatures for her impending real estate transaction. Like many other retail businesses, the real estate business is in the process of undergoing an electronic revolution.
The Internet and other technological advances such as the proliferation of smart phones, has fundamentally reshaped how the business of real estate is unfolding, much like online shopping has replaced the necessity for brick and mortar shops for certain products.
Less than 10 years ago, people were still scouring black and white print newspapers for open houses and house listings. A real estate broker had to be really savvy, succinct, and detailed with their print ad copy of 50 words or less to attract clients to their listings. Today, that Sunday Edition real estate section which used to be delivered at your door, and was the size of a small telephone book, is no longer. Nowadays, traditional newspapers are folding, online editions are growing, the Multiple Listing Service (MLS), and real estate brokers' personal websites or Facebook pages have replaced how buyers traditionally house hunt. With widespread access to the internet, and the relatively low cost to owning a laptop or a smart phone, these technological advances have effectively made house hunting that much more accessible, literally at the end of a client's fingertips, 24 hours a day, 7 days a week.
It's not enough any more for a real estate broker to just plant a "For Sale" sign in a seller's yard. Real estate brokers are now learning to more effectively market their property offerings and services online to cater to a whole generation of potential buyers and sellers who grew up with the Internet, and have never lived a day without it. Social media is the new platform for real estate marketing. Photos can paint a thousand words. Short videos on YouTube can, too.
Waiting in line at the supermarket, on the bus or metro, in bars, and in restaurants or coffee shops, even just walking down the street - people are constantly on their smart phone devices, checking their "socials" - connecting with friends, and conducting business. You no longer have to wait for the Sunday Home Edition newspaper to connect with potential buyers and sellers. It's all happening virtually, right now.
But, do people actually buy houses online? Personally, I have yet to meet someone who has bought a house online without physically visiting the premises first. Perhaps, as virtual reality technology advances, people will eventually feel more comfortable with such a purchase. You'd certainly need to have a high credit card limit for such a transaction to be completed (but just think - the number of air miles that you could accumulate would be phenomenal!). Nothing available "virtually" currently comes even close to being able to walk through a home in person. Yet.
Back to the subject of my friend who asked me about the validity of electronic signatures (e-signatures) for real estate transactions. It certainly makes transactions a lot easier in the sense that it cuts down on all of the time wasted photocopying, scanning, formatting, and attaching documents to be signed by various parties to the transaction. Sometimes all of these additional steps can do more harm than help, and just fluster the client in the process.
So how do e-signatures work? A real estate broker will send you a document via email and ask you to "click" on your electronic signature to accept the conditions stated in the contract. The electronic signature is then validated because it is uniquely linked to your email address, geocoded, and time stamped the moment that you accept it. Another advantage of e-signatures is that other parties to the transaction can be signing virtually at the same time, and located on the other side of the country. Once everyone has signed virtually, a final document is sent to all parties for their records. For people who aren't technologically averse, e-signatures are a convenient, clean, easy, efficient and effective way to conclude transactions.
It's not yet possible to use e-signatures at the Notary, however. You still have to present yourself at the Notary to sign the Act of Sale, or appoint someone to sign on your behalf through a Power of Attorney. But, maybe someday that will change too. The digital landscape and technological innovations are certainly challenging traditional notions of how real estate transactions are conducted - the challenge for real estate brokers today, is to openly embrace and adopt these changes, and to educate our clients about the advantages of the digital revolution in our industry.
What are your thoughts on this subject? Do you shop online? Would you feel comfortable using e-signatures in a real estate transaction? Comment below or holler at me: email@example.com.