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Dec 2005
Index of all
past
Affiliate Corner columns
The Move Toward Paperless Can Save You Time and Money
By Kim Paul, Meah Sarina and Sue Smith
Land Title Guarantee Company
How much do you think your office spends each year to store at least three years of real estate records? What does it cost your company to shred documents once you no longer need to store them? How much do you pay someone to sort, file, and retrieve all of the paper documents relating to every real estate transaction?
One local real estate firm recently spent $2,500 to shred over 3,000 real estate documents it no longer needed. Add that to the cost of maintaining office or warehouse space to store paper files, and the cost of doing a real estate transaction in Colorado just went up.
Some brokerages have resorted to charging R ealtors® a transaction fee from $50 to $200 per contract to cover the escalating costs that eat into income and revenue. In turn, R ealtors® are either absorbing these fees as a cost of doing business or passing them on to their customers. One solution to the escalating costs of storing and shredding paper documents is the paperless closing that is available in Colorado through some title companies.
Electronic versions of the commitment and B-2s are easier to receive, store, and retrieve than paper files, yet there is still resistance in the real estate community to going paperless. “It’s really a matter of educating our real estate and lending clients that electronic files are legally binding and acceptable records in lieu of paper files,” says Shelly DeWit, Corporate Customer Support Manager at Land Title.
Indeed, C.R.S. 24-17.3-107(3) says, “If a law requires a record to be in writing, an electronic record satisfies the law.” Section 102(7) of the same Colorado statute states that “electronic record means a record generated, sent, communicated, received, or stored by electronic means.” This includes information that is scanned, faxed or e-mailed.
There is a national trend toward the paperless transaction. On Aug. 30, 2005, Inman News, a leading national independent supplier of real estate news, announced that it would launch an industry-wide initiative aimed at promoting a paperless real estate transaction.
Inman’s initiative will include Internet videos featuring innovations for digital transactions, industry and public education via a website, conferences with industry leaders, and research on the progress being made toward paperless home sales.
The initiative will also focus on educating the industry and consumers about the tools and processes involved in a paperless transaction. “If we can reduce the time and energy it takes to perform a transaction,” said Bradley Inman, founder of Inman News, “that’s good news for everyone. A lot of people are chained to a pen and paper. They need to be educated about the benefits paperless transactions will offer. It’s a matter of changing long-standing behaviors and eliminating the fear of new, more efficient methods and procedures.”
While not yet fully embraced by the public, the technology exists to create a fully electronic, completely paperless real estate transaction. In 2003, the first fully electronic home purchase took place in a Fort Lauderdale suburb. Title documents were signed and fees transmitted electronically using eOriginal’s software, and all documents were filed electronically with Broward County. And the National Notary Association in May announced the launch of the Electronic Notary Seal Program, whereby the NNA will work with state governments to set standards and provide technologies for national and world-wide eNotarization.
With today’s upcoming generation of adults raised on technology and the Internet, it’s only a matter of time before the tech-savvy consumer demands the time- and money-saving convenience and efficiencies of paperless transactions. |
