Complications in the mortgage industry are increasing due to the COVID-19 pandemic. It is becoming particularly problematic for in-person closings, which have dropped sharply, putting a large number of loans in jeopardy.
"Across the nation, state, county and local governments, including recording offices, have shut down or are at least limiting the number of people who may enter the office," according to CNBC. "That puts the whole system at risk, as title insurers are less able to conduct the title research that goes into issuing a policy. The ability to record documents is also getting tougher as county recording offices close."
While a number of counties provide some electronic access, the report revealed that close to a third of the jurisdictions in the country aren't equipped to accept digital documents.
“At a time like this, when we have perhaps, for many people, really a once in a lifetime refinancing opportunity, they could miss out on that because of social distancing—miss out on that because you can’t get a group of people in a room, that would be a great tragedy,” said U.S. Sen. Kevin Cramer (R-ND).
"Market-wide you have financial institutions participating, you have a major consumer piece, and the consumer drives the market in this country, plus you’re going to move a lot of product a lot better."
Some borrowers are lucky as 23 states are equipped to handle remote notarization. California, one of the most active real estate markets in the country, is one of them.
To learn more about how closings have been hampered by COVID-19, click here.