Posted by snoopdogMs on 11/7/09 7:08am
Msg #310172
Wrong is righted
For the record, this pertains to the closing that I posted a couple of days ago about where the spouse (upon my arrival ) asked for the other spouse not to know the cash out by not detailing all info. I closed the loan, came home and spoke with the SS who advised me to detail my red flag concerns in an e-mail so it could be forwarded to title. I told them that my response to the situation in retrospect should have been different (failure on my part) and that I did not want my seal on the documents or to be part of the transaction if it could be voided. It went to the lender and they voided the loan. And I told the SS I did not want any fee for the closing before it was decided. I have a prominent poster here that I counsel with over matters and if she would share her always on target wisdom on how a notary might respond in such a RARE situation, I will leave that to her.
| Reply by MW/VA on 11/7/09 8:34am
Msg #310182
Good for you!
| Reply by desktopfull on 11/7/09 9:11am
Msg #310187
Does your state require the spouse to know this information? Florida is a spousal state and it is required for the spouse to have the loan info. However, if your state doesn't require this then you potentially could be in a lot of trouble for getting this loan cancelled after the fact, I hope you have a great liability insurance policy. I understand your trying to do the right thing, but you may have stepped over your bounds as a notary in this instance.
Not giving legal advise, just stating my opinion.
| Reply by PAW on 11/7/09 9:42am
Msg #310191
>>> Florida is a spousal state and it is required for the spouse to have the loan info. <<<
Not quite. Florida is a "homestead" state. Florida is NOT a community property state. So, this means that spouses have constitutional rights to homestead property (since the homestead provision is part of Florida's Constitution and not just statutes). However, spouses have no rights to non-homestead property unless specifically given those rights. In other words, if the property is a second home or investment property (not homestead protected), and the title of the property is only in one spouse's name, the other spouse has no claim to the property and therefore does not need to know about any part of the transaction, financially or otherwise.
| Reply by desktopfull on 11/7/09 10:03am
Msg #310193
I'm aware of your statements,I was just trying to be brief n/m
| Reply by PAW on 11/7/09 10:05am
Msg #310194
No problem.
It's just that many SA's aren't aware of Florida's idiosyncrasies when it comes to spousal rights.
| Reply by MW/VA on 11/7/09 7:30pm
Msg #310246
That is great info Paul, and I did not understand the spousal rights in FL. Thanks for clarifying.
| Reply by Linda_H/FL on 11/7/09 9:31am
Msg #310190
This goes back to Msg #309722 - both on loan as co-borrowers...wife raised an issue about the "and" or "or" on the docs...
Then Msg. #309799, in which you posted: "Wife did not want me to say anything about how much money she was getting out ($16K)! or to discuss the paperwork. She said she was the bookkeeper and just follow her lead and don't say anything. She said to just pass the papers and she would pass them to him and tell him to sign. If she thought he might read, she distracted him with talk about work for the day outside! This was an older couple"
As I said previously, the hiding bothers me. I think my response would have been "I'm sorry, but you're both on the loan and there is certain protocol I must follow for both the company that hired me and myself as a notary. Your husband must know what he's signing in order for me to do my job." No way would I follow her instructions to just "follow her lead and don't say anything"... and it was a determination you needed to make prior to even beginning the signing rather than after everything was all signed, sealed and delivered.
This may or may not be righted and I'd be surprised if this was the end of it - either the company has agreed with you just to placate you (keep an eye on the recorded documents to see if this records) or they have, in fact, voided the loan, in which case there's a loan officer out their commission AND a borrower out their funds - and IMO they are not going to be happy.
Good Luck..
| Reply by Pat/IL on 11/7/09 11:29am
Msg #310203
Snoop, I think your after the fact correction was right on. Congratulations on doing the right thing.
As I understood, this was not a matter of a nonobligated spouse but, rather, a borrower and owner of the home being intentionally kept in the dark as to the loan terms. The potential repercussions of being a party to loan fraud are far greater, I think, than answering to a broker's lost commission.
It seems the hiring party and lender also agreed.
| Reply by Linda_H/FL on 11/7/09 11:49am
Msg #310205
Pat it's not just the issue of lost commission (although it's a substantial concern when to the LO and their loss of thousands of dollars) - these borrowers went through the entire application and underwriting process - he couldn't have been in the dark all along as we all know there are preliminary documents and disclosures to be signed by all borrowers - what IF it's just a case of "business as usual" between the two and the wife handling everything because she just does and has for years (as in the case of my husband and I) - what IF there's nothing more going on than a husband and wife refinancing and conducting their business as they always have with the husband having implicit trust in the wife's decisions - the loan is canceled now and the borrowers are NOT going to get their money, and they are NOT going to be pleased. AND if title and lender did cancel this loan based on Marilyn's concerns, there's now a paper trail leading right back to her if the borrowers decide to pursue it. Now the question becomes, can she prove there was something going on....
I agree that the wife saying "don't say anything" and distracting the husband from the loan docs is odd and, yes, suspicious....all I was saying is that from a notary and signing agent perspective, Marilyn's position should have been made clear right at the outset - "I must be able to communicate with him and present the documents to him".
MHO
| Reply by Pat/IL on 11/7/09 12:38pm
Msg #310211
Linda, my main point in all of this is that the wife flat out told the notary that she does nto want the husband to know the loan terms, and she requested that the notary collude. Yes, the best answer would have been a refusal to be a party to the fraud.
Since that did not happen, the proper action after the fact was to notify the hiring party of the concerns. It would not matter a hill of beans to me what the husband may or may not have been told before that point. It was pretty clear from the original post that one borrower was attempting to use the notary to deceive the other borrower.
Better to correct the situation later than never. Snoop did not cancel the loan. She only related her concerns. The decision to withdraw was the lender's.
| Reply by Linda_H/FL on 11/7/09 1:44pm
Msg #310214
Point taken Pat...I see what you mean...
| Reply by Marian_in_CA on 11/7/09 4:30pm
Msg #310226
Yes... but Marilyn was the one who initiated it AFTER the fact. I do give her loads of credit for that... I'm sure that had to take some real guts on her part.
Though it doesn't negate the fact that she notarized the docs. That's an independent act for which she probably could have been more discerning... and by sending them to lender intact and leaving it up to the lender to accept or not essentially says, "Well, I notarized his signature even though I'm concerned he wasn't aware of the nature of the document, but I'll let you all decided what to do."
I think we all agree the best way to handle this would have been to refuse outright... but Marilyn did what she could after the fact. I'm not sure it's completely "right" though. Right or wrong in the situation... if I were the borrower, I'd probably have an attorney drawing up papers to sue the lender and the notary. But then... that's from the borrower perspective and they'd likely not get too far, but it could be messy.
Marilyn, if I were you... I'd likely call the SOS's office and let them know what happened. That even though you did perform the act at the time, you feel it wasn't valid.
And actually... looking at the Notary Rules for MS... yeah, I'd do that just as a CYA move:
"(2) A notary shall not perform a notarial act if the principal:
...
(c) shows a demeanor which causes the notary to have a compelling doubt about whether the
principal knows the consequences of the transaction requiring a notarial act; or
(d) in the notary’s judgment, is not acting of his or her own free will."
I think that's your biggest problem. It's great that the lender canceled the loan... but your notarial act still occurred. Does that makes sense?
Again, though... big hugs for being brave enough to cite your concerns to the lender. That's one part of it. The other part is dealing with the SOS on your end. Because, from a borrower perspective... they could totally nail you. You performed the act... which means, at the time, you were stating the man *was* acting of his own will.
From a technical viewpoint... the notarial act is totally separate from the loan closing.
| Reply by snoopdogMs on 11/7/09 12:02pm
Msg #310209
I had no power to cancel the loan
I just told them the facts and made a request, not a threat The lender must have thought it in their best interest not to finalize the loan if indeed they do not. The wife told me she had a screaming match with her LO. Would she have a leg to stand on? Don't know. I would rather admit poor judgment now with a paper trail before it closed than let silence be my excuse if this was to resurface in the future from the husbands standpoint.
| Reply by LKT/CA on 11/7/09 12:11pm
Msg #310210
<<<As I said previously, the hiding bothers me. I think my response would have been "I'm sorry, but you're both on the loan and there is certain protocol I must follow for both the company that hired me and myself as a notary. Your husband must know what he's signing in order for me to do my job." No way would I follow her instructions to just "follow her lead and don't say anything"... and it was a determination you needed to make prior to even beginning the signing rather than after everything was all signed, sealed and delivered.>>>
5 star statements!! There are at *least* five key elements (in CA) that make for a proper notarization according to the SOS's notarial laws:
1. Signer appears in person.
2. Signer presents ID.
3. Signer appears to understand what they are signing.
4. Signer can communicate with the Notary.
5. Signer is signing of their own free will.
In the scenario, with regards to the husband, three elements are missing for proper notarizations:
a) If wife does not want paperwork discussed and distracts him so he cannot read - Notary
doesnt know know that the husband understands what he is signing.
b) If wife wants Notary to "follow her lead" passing papers to husband and just telling him to
sign - the Notary doesn't know if he's signing of his own free will.
c) Wife probably doesn't want Notary to say two words to the husband - this violates the
communication rule.
<<<I think my response would have been "I'm sorry, but you're both on the loan and there is certain protocol I must follow for both the company that hired me and myself as a notary. Your husband must know what he's signing in order for me to do my job.">>>
The wife's requests break CA notary laws and I would have responded as Linda would have, but added at the end:....and to follow the rules and regulations of the CA SOS.
| Reply by snoopdogMs on 11/7/09 1:25pm
Msg #310212
Think of this.
If wife wanted recourse, she would have to explain to husband the notaries actions and this might be her ticket to divorce court. And one thing might uncover years of deceit. And I have a written statement concerning the void, lender approved. If it is processed and if uncovered later by husband, boy what a can of worms, I would think because of the paper trail.
| Reply by Marian_in_CA on 11/7/09 4:03pm
Msg #310224
Re: Think of this.
I think you did what you could to help correct an improper act... does that make sense?
I know there here in CA, as mentioned above, the proper treatment was to have declined the act to begin with. But the fact is, you performed the act...paid for or not. Kudos for trying to correct it, though.
If that wife had said that to me, I would have been out of there in the most polite way possible.
There may yet be ramifications. You still performed the notarial acts, right? You're probably aided by the fact that the document receiver rejected the documents... but your notarial act still stands. At least for CA... I can see that being a real issue. Not sure about MS, though.
if you look at it from the borrower's perspective, you derailed their loan after performing the notarial acts. They could easily come after you. Will they win? I don't know... her comments to you don't help... but the SOS could take opposition with you, too, given that you performed a notarial act knowing that the husband may not have been signing of his own free will. Again, not sure if this applies to MS or not... but in CA it sure would. I could totally see the CA SOS fining you or suspending your commission for this is a complaint got to them. Or, they could just send you "reminder" letter not to do it again given that you attempted to fix the problem after the fact.
I think this is a good lesson for all of us to be more aware and stand our ground on declining to perform an act if we aren't comfortable that the request is legal.
| Reply by CaliNotary on 11/7/09 8:44pm
Msg #310251
I think this is WAY over the top
"In the scenario, with regards to the husband, three elements are missing for proper notarizations:
a) If wife does not want paperwork discussed and distracts him so he cannot read - Notary
doesnt know know that the husband understands what he is signing.
b) If wife wants Notary to "follow her lead" passing papers to husband and just telling him to
sign - the Notary doesn't know if he's signing of his own free will.
c) Wife probably doesn't want Notary to say two words to the husband - this violates the
communication rule."
If the signer can read and speak English, that's quite enough to satisfy the communication and understanding rule. And it doesn't take rocket science for us to make that determination.
As for free will, unless you see something that indicates that he's NOT signing of his own free will, then it's safe to make the assumption that he is.
Never in a million years would I do a signing where one spouse indicated to me that they wanted me to assist them in hiding some of the info from the other spouse. I'd give them the option of either not doing the signing, or me doing it the way that I always do it, and if they proceeded I would make DAMN sure that I pointed out the cashout amount to the other spouse. And honestly, I'm really surprised that Snoop went along with this at all.
But, since she did, I think she should have lashed herself with a wet noodle afterward and left it at that. There was no deception going on here, the husband had all the paperwork in front of him and could have read any of it at any time. HE CHOSE NOT TO. If he's that easily manipulated by his wife distracting him, then that's his burden in life to bear, not ours.
How many signings have we done where it's obvious that one spouse has been handling the whole process, and the other spouse just shows up to sign and obviously doesn't know the details and doesn't really care about what it is they're signing? It happens to me all the time. Yeah, the way I do my signings they're both going to have a good idea of what they've just signed at the end of it all, but I know that if I just pointed and said "sign here" the show up and sign spouse would do just that with no question. And I'm guessing quite a few of them wish I would just do it that way so we'd be done quicker.
I just hope this doesn't blow up in Snoop's face.
| Reply by LKT/CA on 11/7/09 9:12pm
Msg #310252
Re: I think this is WAY over the top
<<<If the signer can read and speak English, that's quite enough to satisfy the communication and understanding rule. And it doesn't take rocket science for us to make that determination.>>>
Nope, reading and speaking English does not qualify as communication - **a conversation (whether verbal or using note pads writing back and forth) between signer and Notary qualifies as communication**.....I ask the husband a question and HE answers, not the wife answering for him. In the scenario, I was under the impression that the wife orchestrated and controlled the entire signing, even to the point of doing all of the talking (if any).
<<<As for free will, unless you see something that indicates that he's NOT signing of his own free will, then it's safe to make the assumption that he is.>>>
I don't make assumptions when one person wants that kind of control over an event. I consider the possibility that one person may not be signing of their own free will.
<<<How many signings have we done where it's obvious that one spouse has been handling the whole process, and the other spouse just shows up to sign and obviously doesn't know the details...>>>
Yes, but we are still able to do our jobs and follow the law. I've never NOT been able to present the critical docs to ALL signers, even when they don't read anything and wish to sign and be done with it.
| Reply by Marian_in_CA on 11/7/09 10:15pm
Msg #310253
Re: I think this is WAY over the top
I agree with Lisa here.
Remember that, for California, we have to enter in our journal the "nature of the document" per state law. The way I do that is to ask each person signing the purpose of the document. Note what I said there... I don't ask them to tell me what it is, I ask them purpose. Their answer is usually more than enough to satisfy the requirement for me, even if I already know what it is. If they don't know what the purpose is, then I won't notarize it. It doesn't have to be super specific.
For loan signings, it's a bit more complicated since I'm usually the one introducing the documents, but if it's one that needs to be notarized I'm much more careful. For example, when I present to DOTs, I always, always ask them if they know what a DOT is for. Sometimes they know... but not always. I always reiterate that the DOT is a document that is almost always recorded with the clerk and is a public record. I also remind them that is an arrangement between three parties... not just two. I don't go in to great detail, nor should I... but I make sure they understand at least the very basic idea. If I don't think they understand... I won't let them sign until they do. I did have a lady once who did not understand the concept of the DOT at all... and nobody explained it to her. She was from back east and was expecting a straight mortgage document. I waited patiently as she went to her computer and did some research on the differences before she was comfortable signing it. She said nobody bothered to to mention this to her and she didn't see it in any of the literature she was given.
| Reply by JanetK_CA on 11/8/09 12:06am
Msg #310257
Re: I think this is WAY over the top
I think there's a good bit of difference here from the situations where one spouse (usually, but not always the wife), just obediently signs where they're told. In this case, the wife took it one step further by actively requesting information be withheld from the husband. There's no way I'd go along with that. Like you said, I'd do it the way I always do it. That just screams to me of at least the potential for fraud. I wouldn't want to have anything to do with it.
I've been in a somewhat similar situation at least once. One was a situation where a soon-to-be ex-wife was signing something like a Quit Claim Deed. We met at the husband's place of business and she came by just to sign that document. She spoke very little - if any - English (so she couldn't read the doc), and he was trying to get us to just rush through it. It became clear to me that she didn't have any idea about what the document was for, so I finally had to ask him to leave his office and we shut the door while I went over it with her. I practically had to translate it for her but I was not going to notarize her signature unless I was comfortable that she knew the basic concept of what she was signing. I recommended she get legal advice as to the implications. That was all I could do.
| Reply by ReneeK_MI on 11/8/09 4:11am
Msg #310259
IMO you did the best thing you could, in hindsight
Granting that if you could go back in time, you'd have acted differently to begin with - none of us is perfect, and you were thrown a very rare/unique curve-ball. Given the same situation (after the fact), I would've done as you did by putting your concerns out there IN WRITING. The only thing I would've changed is who I sent the e-mail to - I'd have called & spoken with the SS and advised them of what I was GOING to do, and then I'd have sent the e-mail to ALL parties (SS, Settlement & Lender).
Regardless, you achieved the best effect - lender cancelled loan. It's the lender's RIGHT, and IMO you're not implicated in anything at this point. (IMO IMO IMO) Had this same situation played out at a conference table inside a settlement office, no WAY would the loan have even been signed.
The 'potential' borrower, undoubtedly a control freak anyway, is likely to TRY and raise holy he77, that's just typical for people who try to justify their ill-intended actions. What can she say - that you refused to play 'hear no evil/see no evil' with her? Just so much noise, IMO. Her loan was cancelled by the LENDER because she attempted to intentionally fraud the co-borrower and attempted to have you collude with her. What can the L.O. say? You 'killed' his/her commission because ...um ...well, HE/SHE was all on board with it and you killed the party?
I'd put this all behind me, I wouldn't even think about it other than the lesson learned. Again, just my opinion. It was also pretty decent of you to fore-go your fee - certainly not necessary but probably good marketing money spent. =)
| Reply by snoopdogMs on 11/8/09 7:31am
Msg #310260
Last comment here
I awakened out of a deep sleep last evening and my first thoughts were the (and or or) that Mrs. Borrower raised heck about with the LO. Remember she had a screaming match with the LO about putting or on the documents supposedly because as she told me her experience was in the loan field and that there was a big difference in the use of (and or or) on the docs. Well, my 12:30 wakeup was that that whole scenario was not for her protection, but rather she was trying to manipulate how the proceeds check was going to read so that the spouse would not have to sign the check. More interesting was that the lender took less than 2 hours to void the loan after my e-mails were sent. Possibly this manipulation clicked with the LO as to why she wanted such wording after it was brought to their attention by my e-mail. The just arrived signed documents to title may have revealed she forged his name on early documents. Don't know. Did my best to right a wrong with no regrets at this point.
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