Posted by Reverse Mortgage of America - Jessica on 3/5/10 6:13pm
Msg #325585

when a borrower refuses to sign...

certain documents they deem are not necessary, how do you handle this? i've always stated that returning documents unsigned will ultimately cause delays in your loan funding and that my fees will increase to cover the additional trip charges. most of the time it works. i'm wondering what others have experienced recently...i'm getting lots of documents returned unsigned with "borrower refused" without explanation.

Reply by Glenn Strickler on 3/5/10 6:25pm
Msg #325588

I get on the phone with the loan officer and let him / her explain the consequences of not signing certain documents. It's not up to me as a notary to lay that out for them.

Reply by Moneyman/TX on 3/5/10 6:31pm
Msg #325590

What are some examples of the type of docs returned unsign? n/m

Reply by Reverse Mortgage of America - Jessica on 3/5/10 6:35pm
Msg #325593

Re: What are some examples of the type of docs returned unsign?

primarily state required closing affidavits. i've had affidavits the state of maryland requires to be recorded with mortgages. i've had affidavits arizona requires to be recorded with deeds. too many to list them all, but vital to the transaction.

Reply by Linda_H/FL on 3/5/10 7:39pm
Msg #325622

I had a signer about a month ago refuse to

sign the Survey Affidavit..one paragraph states they've not granted any easements, rights of way, etc etc...well, they had and they refused to sign the affidavit in it present form. So, I pulled out one of the 4X6 post-it notes I carry and had them write in their own hand why they would not sign it - and notified all parties in my completion report (couldn't reach anyone from table)... Title had 3 days to revise the Affidavit and forward it for signing..

Reply by Kay/IL on 3/5/10 9:24pm
Msg #325654

Re: I had a signer about a month ago refuse to

That's my practice also.

Reply by Marian_in_CA on 3/6/10 2:20pm
Msg #325724

Same here! No need to hold up the whole

thing for a single document that can be handled outside of the notary. And if it requires the notary... then I will go back.... but if I charge, the discussion occurs with the entity that hired me, and it's 99.9% of the time NOT going to be the borrower.

Reply by Reverse Mortgage of America - Jessica on 3/6/10 8:54pm
Msg #325762

Re: I had a signer about a month ago refuse to

the survey affidavit is a requirement if a current survey is not available in order to issue a particular title endorsement. if the borrower had granted easements, rights of way and so on, they would be required to provide a copy of the current survey. the title company should have communicated this, so at least the borrower could be prepared to provide a copy. what a hassle...if they didn't have a recent survey completed since they granted the easements and such, they would have to get one now. it's so costly in some cases.

Reply by Marian_in_CA on 3/5/10 6:35pm
Msg #325594

No way I tell them that!

You shouldn't be advising them of that one bit. If they refuse... they have the right. You should call and report it from the table if you can, and let THEM explain the potential consequences to the borrowers.

If that's not possible... which has happened to me several times. I have the borrowers write out a note explaining exactly why they are refusing to sign...and I write about it in my report back to the TC.

It is for this reason that I carry loose notebook paper and sticky notes. If they refuse, I make them indicate why... and if they won't do that, I make sure to report it, in detail. I had one borrower who must have used 15 sticky notes and 10 sheets of paper on a package.

Reply by CF on 3/5/10 6:43pm
Msg #325600

Re: No way I tell them that!

When issues arise ....and it is not that often that I make calls from the table....I put them aside until the end. I make a few calls and if there is no response w/in 5-10 minutes...then they sign them or do not. I tell them that I have no idea what will happen w/o the docs being signed. I stress the NORTC and then move on. I do not waste a bunch of time with it. IME it is docs that do not need to be notarized that people refuse to sign. Again, this happens very few and far in between.

Reply by Reverse Mortgage of America - Jessica on 3/5/10 6:47pm
Msg #325601

Re: No way I tell them that!

every borrower has a right to refuse, but they also have the right to be informed of the obvious consequences, even if it isn't obvious to them. if i have to come back for another trip, i will charge an additional trip fee. i also can't account for my availability to make that return trip, which could cause delays. those are both facts. it's the same as if i were to remind the borrowers that they have 3 days to cancel the loan, should they feel they do not want to move forward after all.
my experience stems from the settlement side of the transaction as well. i notarize in accordance with my state requirements, but i also have first hand knowledge of how often delays occur because a borrower refuses to sign a state-required document.

Reply by Marian_in_CA on 3/5/10 7:11pm
Msg #325605

Re: No way I tell them that!

Here's the problem with that thinking, though. The 3-day RTC is a known legal requirement for which you have adequate, authoritative sources where it is considered general knowledge. Each loan is different and if you advise them on specifics on their loan (whether it's true or not) based on anecdotal experience, you're just asking for trouble --- because they will hear one thing, and you'll mean another.

Advising them of unknowns, is to me... a definite no-no. You don't KNOW what will happen if they don't sign. And, even if you do... that's not your decision to make. And, threatening them with extra fees? That's just unprofessional -- who's to day that you'll be the one returning? Isn't that a bit presumptive?

Reply by Marian_in_CA on 3/5/10 7:18pm
Msg #325608

Re: No way I tell them that!

Also... it's not the notary's job to advise them of ANYTHING. All they do is impart facts and legal definitions... any kind of advice, even seemingly innocent or helpful advice, is something notaries really shouldn't be doing.

The consequences of signing a certain document may or may not be fact. And, you shouldn't be telling them a specific document is legally required or not --- doing so means you're giving them legal advice.... or very nearly pushes it.

I never, ever tell a borrower that a document is "required" --- not my place. I resent them with documents that they've been requested to sign. I will tel them the prupose of a document, but that's it.

For example, I always explain what the DOT is, and where it goes -- that's it's a public record and is available from the County Clerk's office. But to tell them they HAVE to sign it in order for the loan to fund?? HECK NO... not my place to tell them what they HAVE to do outside of my job as a notary. For example, They HAVE to give me their thumbprint on a DOT (in CA) ... that I'm legally entitled to tell them.

Reply by John Schenk on 3/5/10 8:18pm
Msg #325631

Re: No way I tell them that!

I just let them know that the docs are a combination of docs from the lender, and the TC, and that the docs in front of them are clearly what the two require or they would not have sent them to me to get the BO's to sign them. Not all docs required by one lender and/or TC are the same as required by others. Each are proceeding on the advice of their legal counsel, I would assume, and it they didn't think they needed to be in there, they wouldn't be. My job is to get every doc in the loan package executed, and that's why I'm at your house.

Occasionally they send totally blank docs in the package, and some with Acks or jurats. They look at it and say "My LO told me to not sign anything that is blank and this doc is blank." Had one the other day, can't remember what it was, but had a jurat and ALL the blanks were empty. They asked me if I'd sign a blank doc like that, and I simply told them that their LO had advised them on that.

JJ

Reply by Reverse Mortgage of America - Jessica on 3/6/10 8:59pm
Msg #325764

Re: No way I tell them that!

i like your approach. it really isn't up to me or the borrower to determine the necessity of the documents provided, just that since they were provided that they are necessary.
i know in california, i cannot affix my seal to an incomplete document. the borrower must either insert the information or n/a to all the blank before it is notarized.

Reply by Reverse Mortgage of America - Jessica on 3/5/10 7:23pm
Msg #325614

Re: No way I tell them that!

i don't approach the borrower in a threatening manner...letting the borrower know that i charge for additional trips (considering the borrower refusing to sign isn't a mistake on my part) if informative. the borrower still has every right to refuse. if i don't explain that an additonal fee applies if i return, then borrower could easily assume that i will come back for free or be more upset that they were not informed upfront. i've experienced it both ways, neither is ideal.

Reply by cawest/PA on 3/6/10 12:59am
Msg #325683

Re: No way I tell them that!

The dieal is to inform him that it should be related to the lender for further advise and left there.
Any information you will give might be seen as legal advise to the borrower and we all know that it is a big NO NO.
I had a few refuse to sign, cntacted the lender and wrote down on the doc: refused to sign, signed and stamped it. Only once out of a few refusal was I the same agent to go back if anyone ever went back.

Reply by cawest/PA on 3/6/10 12:55am
Msg #325682

Re: No way I tell them that!

actually you have no right at all to inform him of the consequences as it might be seen as legal advise and could backfire badly against you. Also accounting for your availability is uncalled for as another agent might be going and certainly not tell the borrower that he will be charged an extra fee as that is for the lender to make the decision on the steps to be taken and not you the NSA.
I agree that a delay will occur however that is a problem to be solved between the lender and the borrower.
And as far as the RTC is concerned you can inform the borrower but cannot impose it uponhim in order to see a doc signed.

well that is my humble opinion ...

Reply by Reverse Mortgage of America - Jessica on 3/6/10 9:02pm
Msg #325765

Re: No way I tell them that!

rarely would another signing agent be asked to complete forms that a borrower refused to sign. depending on who picks up the tab for the additional signing, hiring the same notary as before is typically a less expensive option. this is in my experience, but may not be the same for everyone.

Reply by cawest/PA on 3/5/10 6:42pm
Msg #325598

as the other said : call the loan officer and have him explain or have the borrower write a note as of why he refuses to sign certain docs. Just cover yourself so there is no dispute when your payday gets there!

Reply by Art_PA on 3/5/10 7:19pm
Msg #325610

If this happens to a notary often, the notary is doing something wrong - probably talking and explaining too much. In thousands of loans closed over more than 10 years, I do not remember this happening except with the form directing sending the tax bills to the lender when the borrowers taxes were not being escrowed.

Reply by Reverse Mortgage of America - Jessica on 3/6/10 9:04pm
Msg #325767

there is not one particular notary this is happening to. i work with many notaries in all 50 states and have seen my fair share of the borrower refusing to sign certain documents.

Reply by PAW on 3/5/10 7:32pm
Msg #325616

I tell them that not signing any document may (emphasis on the word "may" cause delays in the funding of their loan. If they continue to refuse, I have them (emphasis on the word "them" complete a simple form that I have called "Refusal to Sign" (http://www.pawnotary.com/forms/Notice%20of%20Refusal%20to%20Sign.pdf). They write it out in their own words and sign it. I submit that report with my closing report and return it with the documents.

Not only does the Refusal notice let the necessary parties know why the signers refused to sign, it also helps in getting paid for "no sign" and "non-funding" signings.

Reply by Reverse Mortgage of America - Jessica on 3/5/10 7:36pm
Msg #325618

that's rather insightful. cya. thank you!

Reply by desktopfull on 3/5/10 7:38pm
Msg #325621

Great idea PAW. Hadn't thought of having the borrower's write out the explaination.

Reply by SueW/Tn on 3/5/10 8:50pm
Msg #325645

A belated TY to Paul

I downloaded his form years ago (I just checked to see if you'd changed it) and have had to use it 3 times, was really happy I had it and wouldn't "leave home without it".

Reply by Kay/IL on 3/5/10 9:21pm
Msg #325652

Excellent tip Paul! n/m

Reply by TRG_wy on 3/5/10 10:00pm
Msg #325661

I have a very similar form I have been using for about ten years myself.

I probably have had to use it only about four times. Seem that when bo sees the form, thay change their mind and decide to sign afterall. I don't have to say anything.

Reply by John Schenk on 3/6/10 12:41am
Msg #325677

Very good advice PAW! n/m

Reply by cawest/PA on 3/6/10 1:01am
Msg #325684

TYVM, just printed a few out just in case

Reply by desktopfull on 3/5/10 7:36pm
Msg #325619

Have you heard of UPL? Never advise a borrower, you

call the TC or LO, if you can't reach them, then you politely explain that if they don't wish to sign that is okay and that you are leaving with the documents and the TC or LO will get back with them to work out any misunderstandings they may have concerning the documents, thank them for their time and leave. Wow, you are really asking for trouble if you really are doing what you stated.

Reply by Reverse Mortgage of America - Jessica on 3/5/10 7:40pm
Msg #325624

Re: Have you heard of UPL? Never advise a borrower, you

telling someone i will charge additional fees for additional trips is not UPL, it's fact. as PAW explained, replacing *will* with *may* is a better choice of words.

Reply by CF on 3/5/10 8:26pm
Msg #325635

I do not understand why you are telling them of a return fee

It has nothing to do with the borrowers. It seems like you are using that in your favor and that they will then think that they will pay you so that they will be pressured into signing the docs? The company that hired you is responsible for payment.

Please explain your reasoning for telling the borrower this?

Reply by jba/fl on 3/5/10 8:35pm
Msg #325640

Re: I do not understand why you are telling them of a return fee

Not thinking it through from truth to dare

Reply by Marian_in_CA on 3/5/10 11:56pm
Msg #325674

I wonder the same thing...

That's one of the parts that bothers me most about this. Why in the WORLD even mention extra fees to the borrower? That's why I said it felt threatening. Her payment for services has nothing to do with the borrowers... so, why even bring it up? If a return trip is needed, the fee needs do be discussed with the entity that hire her -- and that's usually never the borrowers.

Oh, sure... they end up paying for it eventually... but it's not a direct relationship.

Reply by Reverse Mortgage of America - Jessica on 3/6/10 9:08pm
Msg #325768

Re: I wonder the same thing...

i'm sorry for not clarifying who my hiring party is...in my cases, i AM hired by the borrower. fees are definitely discussed with the party who hired me. i understand that this is rare, but assuming that my business is directed by an agent or ss isn't accurate. i've surprisingly even had "walk ins".

Reply by desktopfull on 3/5/10 8:32pm
Msg #325637

I wasn't aware that your client was the borrower

so if the borrower is paying you by all means tell them that you will be charging extra if you make another trip for the closing. However, if the TC or SS is your client, then this may possibly be construed (not giving legal advice) as coercing borrower to achieve the goal of getting the loan documents signed in a court of law. Many times I've gone back and resigned loans and the TC or lender has eaten the cost of the second trip, it was not passed on to the borrower because the TC or lender made a mistake or failed to explain something to the borrower, who refused to sign documents without a valid explanation. Just something you might want to consider or review with an attorney.

Reply by Grammyzoom on 3/5/10 8:41pm
Msg #325642

Interesting topic

Over the years I have only had a borrower refuse to sign something a few times. After explaining to them that this may delay funding and they still refuse to sign, for whatever their reason, I simply have them write "borrower declines to sign", initial and date the document and send it back with the package.

Reply by Susan Fischer on 3/5/10 11:17pm
Msg #325668

Perfect solution, GZ. n/m

Reply by Reverse Mortgage of America - Jessica on 3/6/10 8:48pm
Msg #325761

Re: I wasn't aware that your client was the borrower

in my experience, when a borrower refuses to sign a state-required document or lender document because they deem it unnecessary it causes delays. for some borrowers, the idea of paying additional daily interest on their current mortgage or that their funds may not come in as planned is enough to complete the signing. i can't tell you how many times i've had to contact a borrower to execute documents in order for their loan to fund and their response it almost always the same..."why wasn't i told this when i first signed the docs?" if the agent, lender or i didn't make a mistake, it is up to the borrower to cover the additional trip fee, should an additional trip be required. they also have the free option to meet me at my office within their recission period, should they want to review the documents further. its definitely not presented in a "my way or the highway" manner, the borrower is always reminded of their options available to them.
occasionally i am hired by a ss, but not as commonly as i am hired by borrowers. weird, i know. but i've been a settlement agent for so long, that previous co-workers have always recommended me to their borrowers. i don't do many loan signings anymore...i'm actually very busy at work and i also attend school at night.
my post indicated that “i'm getting lots of documents returned unsigned with "borrower refused" without explanation.” i feel that the form provided by PAW will be helpful in determining the reason for the docs not being returned signed. it would allow me the chance to contact the borrower and futher explain the purpose of the documents i need signed.

Reply by cawest/PA on 3/6/10 8:17am
Msg #325700

Re: Have you heard of UPL? Never advise a borrower, you

I will argue the matter that it is a *fact* as first you have no clue what the debate will be between the lender and the borrower as a mistake on paper might be the result of a mistake by the lender and the borrower caught it and second you do not have any indication that you will be the signing agent going back to *notarize* the docs and you do not know if the lender will put it on the borrower's tab or if the lender will absorb the cost.

I look at it this way : Every transactions needs a *goofer* and I am the *goofer* between the lender and the borrower ( a good paid one but still one) I have no legal authority which puts me in a position to be on time, to be professional and to collect signatures, to give them the basics which one of them is the RTC and that's it! I make sure all signatures are collected and if ANY PROBLEM arises I place the call that will either resolve the matter or make me pack and leave to turn everything back in for resolution but in no way will I start to tell the borrower what will happen or could happen as I am in no position to give legal advise (that is very clearly understood when we become notaries and NSA's)

Now this is just my 2 cents but so far I have never ran into any problems for misconduct which I feel that starting to jabber with a borrower is a form of misconduct.

Reply by JanetK_CA on 3/6/10 2:36pm
Msg #325727

Can't help myself here... ;>)

File this under "let's enjoy our chuckles where we can find them..."

Can I assume (I hope) that you meant that you are the "go-fer" vs. the "goof-er"?



As for the content of your post, pretty much agree, in principle.

Reply by cawest/PA on 3/6/10 3:40pm
Msg #325733

Re: Can't help myself here... ;>)

OMG ... going to hide under me sheets ... I cannot believe I put 2 o's on gofer ... oh my oh my ... what am I becoming ...!!!!

Reply by jba/fl on 3/6/10 4:07pm
Msg #325736

Re: Can't help myself here... ;>)

human

Reply by JanetK_CA on 3/6/10 7:16pm
Msg #325749

Right, Julie! And I appreciated the comic relief! ;>) n/m

Reply by JulieD/KS on 3/5/10 10:51pm
Msg #325664

I tell them that they can't pick and choose what to sign, that they either need sign everything or nothing.

Reply by Marian_in_CA on 3/5/10 11:58pm
Msg #325675

Who are YOU to say that, though??

They aren't your papers... and unless there's an explicit instruction that says "they sign everything or nothing..." then by telling them that, it's coercion.

Reply by JulieD/KS on 3/6/10 9:37am
Msg #325705

Re: Who are YOU to say that, though??

Who am I, Marian of CA? I am the trained signing agent and I know that they can't pick and choose. The docs are there for a reason. They can't sign what they want and not sign others.

Reply by JulieD/KS on 3/6/10 9:40am
Msg #325706

definition of coercion

Telling the borrowers they can't pick and choose what they sign is NOT coercion. This is the definition of coercion, Marion. I was not using force or intimidation. I just telling them how it works.

co·er·cion   /koʊˈɜrʃən/ Show Spelled[koh-ur-shuhn] Show IPA
–noun
1.the act of coercing; use of force or intimidation to obtain compliance.
2.force or the power to use force in gaining compliance, as by a government or police force.

Reply by Marian_in_CA on 3/6/10 2:16pm
Msg #325722

I disagree....

If you tell them, "If you don't ALL the papers, I have to leave...." or something like that... that's basically a threat and you ARE intimidating them! You're telling them... outside of your authority.... that they MUST sign all the papers or the loan won't close. In a lot of cases that may not be at ALL true!!

What if the one page they don't want to sign turns out to be optional or non-required for closing? I've had quite a few packages where this has happened, especially with educated borrowers who KNEW that a particular item was optional. It's not your place to make the determination.

As Janet mentioned below if there is a problem, there are a LOT of forms that can be taken care of during the rescission period that don't require the notary and can be handled quite simply with a fax or overnight courier.

A couple months ago, I had this happen. The borrowers had a question on one of the "junk" forms and were not comfortable signing it. No problem for me... we finished the package, and they wrote out an explanation. This was not a form that required notarization. The Title company called me and THANKED me for getting it done and that, indeed, they made an error on that one form, but it wasn't essential to the closing. It was a compliance document. They overnighted the corrected document to the borrower, and the borrowers simply mailed it back after signing it. I didn't need to get involved at ALL.

If I had pulled the, "you sign it all or it's not happening" stunt -- I would have wasted everybody's time and if I had threatened to charge more money for a return trip?? That would have been simply dishonest.

Yes, I think that (unless I have explicit instructions otherwise) telling the borrowers to sign it all or nothing IS coercing them.

Reply by GOLDGIRL/CA on 3/6/10 12:47am
Msg #325678

I'm with you, JulieD ....

Lenders and TCs put docs in packages for the borrowers to sign. Period. Borrowers don't get to pick and choose and say, well, I'll sign this but not that. If signing certain docs is optional, then said doc would indicate so. If they decide not to sign something becasue it is not to their liking, then it's an immediate call to the hiring entity to decide what to do. If hiring entity is not returning calls, is in bed for the night, etc. signing is over, as far as I know. I can't count the number of times borrowers whine over signing the 4506T. What if I said, well, that's OK, if you don't want to, write this note and explain why .. Gimme a break. Actually, I had a Wells Fargo loan officer tell me that they throw those away the instant they open the loan pkg.!

By the way, PAW had and maybe still does a nifty "Why I am not signing this loan" form on his Web site .....

Reply by GOLDGIRL/CA on 3/6/10 12:50am
Msg #325679

Oops! Just say PAW had linked the form n/m

Reply by JanetK_CA on 3/6/10 2:20am
Msg #325688

I agree with Marian

I've sat across the table from some pretty smart borrowers and I've also known a loan processor (or someone else) to make a mistake from time to time. I've seen documents that clearly should not have been signed by the borrowers and probably shouldn't have been in the package in the first place because they were in direct conflict with other key elements of the loan. An example that comes to mind would be an impound authorization where none was required, wanted or set up. Another I've seen a couple of times recently is a close account authorization for a HELOC in a package that had a subordination agreement for that account.

In any case, individual documents with problems - perceived by the borrower or real - can most of the time be worked out during the rescission period, if there is one. At least in my state, that is often true for the HUD, as well. (Of course, these days that depends on what and how much might need to be changed.) So it may make perfect sense for a borrower to proceed with the rest of the signing and not let one document stop the process. AND it might make a the difference between meeting a rate lock deadline or not - which could be costly if interest rates have gone up. Regardless, it's not our call to make.

Also, these days, use of the RTC as a way out doesn't seem to be nearly as attractive an option as it used to be in the days when there was always another lender in the wings that would be happy to offer a loan to that borrower. That just complicates it for us a bit and is even more reason to attempt contact with the client and to not try to "encourage" any particular action on the part of the borrower. However, I would always make them aware of that option.

If the borrower just isn't comfortable signing certain documents (like the 4506T) and there isn't a specific reason for them to not sign, then I'd simply tell them "your loan might not fund without this", followed by a shrug, a smile and a pause in the process while I wait for them to sign or tell me they refuse. Another option I've used several times is to offer to put that page sideways for the time being, let them think about it and come back to it at the end while I check over the docs. Usually by then, they decide to go ahead and sign it anyway.

BTW, for the 4506T these days, as I give that to the borrowers, I tell them that they've probably already signed at least one of these, but this is something that is included in every package and I briefly tell them what it's for. Haven't had a single issue with getting that signed since. (The lender can do whatever they want with it.)

Reply by RJE/MI on 3/6/10 3:37pm
Msg #325731

Re: I agree with Marian

When a borrower has an issue about signing a document I simply state "I cannot encourage or discourage you to sign anything." I will set this aside in case anything else comes up and we can just make 1 call at the end.

Janet you are correct, by waiting until you are done signing everything the borrowers don't want to wait for you to make the call and possibly have to wait for someone to call you back especially now that they have seen everything and all the important details such as dollar amounts, monthly payment and note terms are what they expected and usually sign.

On the rare occasion when they still don't want to sign something which is usually always the Limited POA in my case I call at the end and the TC or Lender asks me if I told them that this was only for typographical or clerical errors and does not effect dollar amounts or loan terms. Which I respond yes I did. They then have always told me that's fine then as long as they sign the E&O form.

That's how I roll anyway.

Reply by JanetK_CA on 3/6/10 7:25pm
Msg #325750

Re: I agree with Marian

The only part I might do a little differently is not wait to place a call. I'm often dealing with several hours difference in time zones and it can be difficult to catch some in. So we leave a message and we either get a response or not. If no call back by the time we've come back to those pages, they have a choice.

I have to reiterate, as Marian stated in her more recent post, that the lender and tc are *most likely* to want us to at least get signed as much as possible. If everything that needs to be notarized at least is done, then I'd bet that in the vast majority of cases whatever issues remain can be dealt with. If I adjourned a signing because a borrower refused to sign just one or a few of the docs, I don't think I'd be working for those people again -- especially if it was directly for the tc!! Now, if it was the borrowers' decision to adjourn the signing, that's a different kettle of fish, and within their rights. (But if the notary did that, I wouldn't be surprised if the borrowers wanted a different notary for the re-sign as well as the client...