Legality and Electronic Signatures

Legality and Electronic Signatures

Legality and Electronic Signatures

Many real estate agents ask about legality issues surrounding electronic signatures. The e-sign act passed in 2000 was created specifically to enforce the legality of the electronic signature. Some of you have mentioned that certain industries, mainly lending institutions, still aren’t accepting electronic signatures. While some lenders might not accept electronic signatures, I believe the confusion is stemming from digital signatures (click to sign solution from providers such as Docusign) and the fact that digital signature is not actual handwritten signature.  Regardless in these very limited cases you might be required to go back to the old-fashion pen on paper signature.  But as electronic signatures become more ubiquitous across several industries, the likelihood of anyone not accepting electronic signatures is becoming more rare.

I personally believe that there are more checks and balances to apply through use of electronic signatures. First of all there is a time stamp and IP address attached to the “signing event” of an electronic signature (well at least when using Real Estate Dashboard software). So when you know what time it happen and where it happened isn’t that better than trying to find out who “forged” a signature using a normal pen on paper? You don’t know where it happened and it takes a forensics team to compare the signature to a possible suspect of the signature.

It is important to know that there is limited case law for electronic signatures due to the fact that no case has ever been contested in court of law.

If you want to review the act as whole here is the link to the ELECTRONIC SIGNATURES IN GLOBAL AND NATIONAL COMMERCE ACT of 2000.

http://www.ftc.gov/os/2001/06/esign7.htm

1 Response

  1. Thanks for mentioning DocuSign. Understanding ESIGN and UETA is part of the picture. Knowing that the FHA does accept electronic signatures is another part of the puzzle. As people gain familiarity and understanding of electronic signature, paperless process will be more accepted.

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