Posted by grapebed on 10/15/12 8:03pm
Msg #438700

L/O's notarizing for their fellow L/O's in the same Company

We live in a highly charged "risk management" environment( vetting, Secure Setlements, etc.)

Does anyone find it odd that L/O's who work in the same Mortgage Company can simply have their "buddy" in the next cubicle notarize his/her documents? Is there some sort of conflict of interest? Or am I paranoid?

Reply by NVLSlady/VA on 10/15/12 8:12pm
Msg #438701

Which documents - business or personal?

Reply by NVLSlady/VA on 10/15/12 8:27pm
Msg #438704

I also once knew 2 spouse teams that owned/operated their own mortgage co. The 1 spouse team were owners and the other was office mgr/originator/closer. The latter used same last names. Lots of family businesses like taxes and payroll do this. Can't get closer to the next "cubicle" than that (of course, they'd need to be cautious in notarizing outside of their business affairs). Be nice to hear how some of the family affairs work this out . . .

Reply by LKT/CA on 10/15/12 9:41pm
Msg #438710

Yes, you're paranoid

The one benefiting directly from a real estate or loan transaction is the BROKER. The contract is between the client and the broker. The client pays the broker the commission. The broker pays the agent a cut of that commission. L/Os benefit INdirectly from the loan transaction - not directly. Therefore, L/Os notarizing for each other is not a problem, at least in CA it isn't. Hopefully, these L/Os are not relatives (i.e. related by blood, marriage or adoption)....then it might be a problem.

Reply by Pro Mobile Notary on 10/16/12 12:00am
Msg #438713

Re: Yes, you're paranoid

I just love it when CA notaries are clueless about the laws of our state and make posts that are 100% wrong.

In CA it is prohibited for a notary that is an employee of a mortgage brokerage company to notarize any loan doc sets for a transaction for the mortgage brokerage they are working for as an employee.

Reply by LKT/CA on 10/16/12 2:08am
Msg #438718

Re: Yes, you're paranoid

<<<I just love it when CA notaries are clueless about the laws of our state and make posts that are 100% wrong. In CA it is prohibited for a notary that is an employee of a mortgage brokerage company to notarize any loan doc sets for a transaction for the mortgage brokerage they are working for as an employee.>>>

Please site the law/rule that backs your statements above.

I hold a current California R.E. license and know the agency relationship between broker and agent. I also know that the PRIMARY governing entity for mortgage brokers in CA is the Dept. of Real Estate. Loan officers are agents for the mortgage broker, just as real estate salespersons are agents for the real estate broker. In both cases, the broker benefits directly from the transaction, not the agent. The commission agreement is between the broker and the agent, NOT the agent and the client.

Mortgage brokerage companies may have their own rule regarding who they allow to notarize deals but as far as the LAW is concerned - it is not a conflict of interest. Notary law, page 10 of the handbook, says it is NOT a conflict for the notary. I've taken the required real estate principles, practice and the escrow for my license. I've also taken real estate law, appraisal, property management - all college classroom courses. Real estate law ALSO says it's not a conflict.

Again, please site the CA laws/rules that support your allegations above.

Reply by dgd/CA on 10/16/12 9:39am
Msg #438726

Linda, I agree with you. If for some reason I have "missed"

something, or misunderstood, I too would appreciate it being cited.

Reply by NVLSlady/VA on 10/16/12 10:26am
Msg #438732

Notary Employees

Hmmm . . . Aren't most notaries "employees" of companies?? They are usually "encouraged" by their employers to seek the commission.

I would have really loved to see the company officers, hierarchy, mortgage staff, etc. of my former Employer/financial inst. step one foot Outside the building to get a "non-employee" notary

Reply by MW/VA on 10/16/12 10:48am
Msg #438733

Don't know what CA law says about it, but it's always been

my understanding that notaries doing the signing is as a disinterested 3rd party. We don't legally represent the lender & we don't legally represent the borrower. I would think it is conflict of interest to being doing that "in house". This is just an opinion, of course.

Reply by NVLSlady/VA on 10/16/12 11:30am
Msg #438742

Not all notaries are deemed "NSA"

Naturally, being a "party" to (or a perception of benefiting from) a transaction creates a "conflict of interest;" but, whether I have on my "notary" hat or my NSA "hat," I only represent the Transaction on the table. At that point, the VA SOC is my "boss."

We can market ourselves as NSAs, but at the end of the day, aren't we public officers commissioned as 3rd party witnesses - who in some instances have made it a point to know the settlement business, carrying our "craft" a bit beyond the norm/typical notary? It may NOT be a good idea in such cases to work for industry-related - loan officer, realtor, insurance. But if that "list" gets any longer, a notary "impartial witness" may not be found for all the $xxx fees in the Commonwealth!

Reply by LKT/CA on 10/16/12 1:32pm
Msg #438761

This is not directed at anyone specifically, but I was addressing the OP's question regarding licensed loan officers notarizing for their buddies in the next cubicle, not other non-licensed office personnel (i.e. receptionist, admin. assistant, etc.) who have notary commissions. The mortgage company may have their own rules regarding who they allow to notarize. However, according to the CA Dept. of Real Estate and the CA SOS, agents are allowed to notarize the deals for that firm because they don't benefit directly from the transaction - the broker does.

The CA Dept. of R.E. sees the agent as an employee of the broker while the IRS sees the agent as an independent contractor. The deals are between the client and the broker. The agent does all the work, as is the definition of the word "agent" (i.e leads, listing, marketing, showings, etc.) the broker signs off on everything. The broker takes responsibility for the agent's action. The agent (loan officer or salesperson) can do NOTHING without his/her license being under a broker. When the transaction is complete, the broker gets paid (direct benefit). The broker THEN pays the agent his/her share of the commission (indirect benefit).

Reply by VT_Syrup on 10/16/12 2:38pm
Msg #438773

It varies from state to state. In my state the law allows an employee or stockholder of a corporation to take an acknowledgement for an instrument in which the corporation is a party.

http://www.leg.state.vt.us/statutes/fullsection.cfm?Title=11&Chapter=001&Section=00231