The Investor's Guide to Remote Closing

Remote closing is a relatively new concept in the real estate business. It has many benefits for all investors, not only those out of state.

Buying – and selling – a house remotely is becoming more and more common these days. The spread of this practice was accelerated by the global pandemic. But it seems that even after the official end of the Covid-19 crisis, this concept is here to stay in the real estate industry for the important advantages it provides.

Table of Contents

What Is Remote Closing on a Real Estate Property?
How to Do Remote Closing: 3 Different Strategies
Why Use Virtual Closing on a House?: 4 Benefits
Where to Find Good Investment Deals for Virtual Closings
History of Closing Remotely in the Real Estate Industry
Will Remote Closing Become the Norm?

If you’re new to the housing market, you might be unfamiliar with the idea of remote real estate closing. There’s nothing to worry about. This article is meant to be a comprehensive guide on everything you need to know about this as an investor.

So, read on to learn all you should have in mind when closing on real estate investment properties, not in person.

What Is Remote Closing on a Real Estate Property?

The remote closing meaning refers to what is sometimes also known as a virtual closing. This process is similar to a traditional real estate closing and has the same purpose. It constitutes the final step of buying a real estate property and financing it.

The only difference between the traditional and remote versions is that with the latter many or all components of the procedure are executed remotely or virtually. Specifically, the buyer, the seller, the real estate agents, and the attorneys do not assemble around the closing table in person to review and sign an agreement and make the necessary payments. Instead, all steps are completed online.

As you can imagine, this brings many major benefits to all parties involved. In this way, you can close real estate deals from any place in the world, which makes investments and transactions much more efficient and less limited. However, there are also some complications and considerations that we’ll discuss in a bit.

Another thing you should know is that closing deals remotely is frequently associated with eMortgages. These are mortgage loans that have been digitally established, enacted with electronic signatures, and kept electronically.

It also goes well hand in hand with the increased use of technologies throughout the real estate investment journey. If investors can find deals online, they should also be able to close them online.

What Is a Remote Closer?

A remote closer is a real estate closer–or title closer–who focuses on remote closings. This real estate career is different from an agent or a broker. The responsibilities of the closer relate to preparing and processing documents, working with lawyers, bringing the papers to all parties, and ensuring compliance with all legal requirements.

How to get into remote closing?

To become a remote title closer, you don’t need formal real estate education, but you might require proper training and certification. You might also need to have a certain number of years of experience in the industry. It depends on the specific market, so you’d need to find the exact legal regulations in your place.

In any case, you will have to identify a real estate brokerage willing to hire and work with you.

How to Do Remote Closing: 3 Different Strategies

With remote closing explained, it’s time to see how to remote close in reality.

Like everything else in the real estate property industry, there isn’t just one way to close on a house remotely. Indeed, there are three popular strategies for going about virtual closings.

Let’s see what’s entailed and required by each.

1. Hybrid Closing Method

In 2023, the vast majority of US states allow closing on homes not in person. The only states that don’t permit any type of online notarization are California, Connecticut, Delaware, the District of Columbia, and Georgia. Meanwhile, Alabama, Mississippi, and Rhode Island have temporarily allowed online notarizations, and this practice is expected to expand further in the future.

Even if the market where you plan to buy long term or short term rentals for sale does not allow closing fully remotely, there might be certain parts of the process that can be done virtually.

For example, you can sign anything that doesn’t need a notary electronically before the final closing date. When the date comes, you can meet with a notary or a closing agent in person to finalize the remaining documents and pick up the keys to your new property.

This process is known as the hybrid closing method. Because this method isn’t completely remote, it is legal across the country as vital documents are still signed in person. At the same time, it helps investors speed up the process, skip some in-person meetings, save on travel costs, and close faster.

2. Remote Online Notarization (RON)

You can complete the entire remote closing process from the comfort and privacy of your home or anywhere else with remote online notarization or RON. You will need to verify your identity in some way, and that’s usually done through a video call, where you provide identification papers such as your driver’s license, passport, or ID during the closing phase.

As of 2023, RON is legal in most states in the US housing market. Unless your market falls in one of the states listed above, you can execute fully online closings. Current real estate trends point in the direction that we can expect closing remotely to become lawful in the rest of the states soon.

After all, this practice has significant advantages for both out-of-state and local investors who don’t want to waste time on technical procedures. And as long as the necessary online security measures are taken, real estate and legal professionals have nothing to lose from this new trend.

3. In-Person E-Notarization (IPEN)

A third way of escaping the traditional closing process is signing closing documents online but not remotely. This method is known as in-person e-notarization or IPEN. Under this arrangement, an electronic notary can notarize the deal without signing actual papers, but all persons involved in the closing must be physically present.

Although this online closure must be completed in person rather than remotely, it still reduces paper waste by using electronic documents. Moreover, it makes everything more efficient as electronic copies of all documents are automatically shared with and saved by all parties for future reference. Meanwhile, it helps safeguard the closing by verifying everyone’s identification in person.

So, if your state does not permit remote online notarization or you are skeptical about it, you can take advantage of this approach.

What Is a Wet Signature?

Wet signatures are a concept related to the increasing practice of remote closing across the US market. A wet signature is when a person signs their name on a physical paper document using a pen or a seal. In other words, this is a physical signature as opposed to an electronic one.

For hundreds of years, wet signatures were a binding contract used to prevent fraud. However, thanks to RON, now virtually any document can be validly signed and verified online–or remotely–if permitted by federal and state law.

In 2023, states without everlasting RON payments can require that a number of your loan documents, like promissory notes or different notarized closure paperwork, be signed by hand and in person. Some states or maybe your loan lenders can also expect this for legal reasons, including protecting you from fraud.

4 Tools for Virtual Closing

The rapid spread of virtual real estate closings has necessitated the emergence of online tools to support the participants, including various real estate professionals.

Here are the most important tools to have at your disposal:

E-signature app: Collecting reliable, verifiable electronic signatures is at the core of closing remotely. So, you need a trustworthy tool that can help you with this. There are plenty of affordable options you can choose from. By the way, all e-signatures are as valid as wet signatures owing to the E-Sign Act of 2000.
Digital notary: You’d also need an online platform providing digital notary services. Some tools can even connect you and arrange a meeting with a notary in person if required in your state.
Video call platform: Some steps of the virtual closing process require online meetings and video calls. You can choose your favorite from Zoom, Skype, Google Meet, and the lookalikes.
Document sharing and storage tool: You will need to share documents for review and approval with the other parties involved, as well as store signed documents in the long term. It means you need access to a safe digital storage place with a large memory capacity.

Why Use Virtual Closing on a House?: 4 Benefits

The benefits of online closing became apparent during the pandemic. But physical distancing and public health are not the only advantages this process offers.

So, now that you know how to start remote closing, let’s take a look at why–if at all–you should consider this possibility.

The main pros include the following:

Out-of-state investments: The most important benefit of closing remotely is making remote rental property investments much more efficient and viable. If you live in Massachusetts and want to buy an income property in California, it’s expensive and time-consuming to visit a few times to sign all documents.
Working a 9-to-5 job: Even if you invest locally, you don’t want to waste all your time meeting with agents, attorneys, and title closers, especially if you have a full-time job. With this strategy, you can attend your job and sign necessary documents from the office or home.
Buying a few properties simultaneously: If you’re a serial real estate investor, purchasing a number of properties a year can become an absolute nightmare with physical closings. Alternatively, you can follow your own rhythm and work without unnecessary stress if you do all the legal work online.
Executing processes at your own time and pace: With traditional closing, you have to attend meetings at certain times. With virtual closing, you can follow most of the steps at a time convenient for you. All you need to do at a specific time is attend a video call or two.

Where to Find Good Investment Deals for Virtual Closings

Online closings provide investors with the opportunity to optimize the processes involved in buying a rental property. But before you decide how to close the deal, you must have a deal on the table. In other words, you need to find a profitable investment opportunity that matches your budget.

The best way to do that is also virtually: with the help of the Mashvisor real estate investment platform. If you already have a few potential markets in mind, you can use the Mashvisor Property Finder to identify the top-performing short and long term rental properties for sale there.

All you have to do is to enter your search criteria, which can include:

City (up to 5 US cities simultaneously)
Rental strategy
Property type
Number of bedrooms and bathrooms

Once you choose your preferred values, the Property Finder will generate a list of available properties for sale that would turn into the most profitable investments. The list will go from the highest cash on cash return down so you can jump on the best deals right away.

To start searching for the best investment properties for sale for remote closings, sign up for a 7-day free trial of Mashvisor.

Mashvisor’s Property Finder makes it easy for investors to find the most profitable markets for investment properties prior to a remote closing.

History of Closing Remotely in the Real Estate Industry

Digital closings existed before Covid-19, although they were not as commonly employed. Out-of-state investors living a few thousand miles from where they invest mainly utilize them.

The global pandemic and the related restrictions necessitated the spread of this phenomenon in order to be able to close real estate deals and complete real estate transactions during these tough times. But the growth in virtual closing highlighted the benefits to all parties directly or indirectly involved. This encouraged many state governments to enable legislation to make it legal.

As a result, in 2023, only four states and DC still do not allow this new trend in the US housing market.

Will Remote Closing Become the Norm?

Yes, we have all the reasons to believe that more and more real estate deals will close remotely. And more and more investment properties will utilize virtual financing. Remote closings are a practical new way to handle the process of receiving your property, and they appear to be the obvious next step in the real estate sector.

Of course, just like any other online transaction, virtual closings raise a lot of questions related to data safety and security. The stakes here are very high, averaging a few hundred thousand dollars per deal, which sometimes exceeds a million dollars.

However, online security is undergoing new improvements every day. Even though these technical aspects go beyond the real estate industry, they definitely benefit residential and commercial property professionals.

So, all in all, we can expect the majority of closings to become remote within a few short years.

Final Words on Remote Closing

Remote closing is a quicker and more practical way to obtain the keys to your new investment property, but the laws aren’t uniform across the country. Before choosing if this type of closing is right for you, investigate your state’s remote notarization legislation and ensure that you always stay on the legal side of things.

Meanwhile, whether you opt for an in-person or virtual closing process, remember that the core of real estate investing is finding the most profitable opportunities. And there are plenty of online tools that can help you with this. The best one is the Mashvisor Property Finder which allows you to look for listings with the highest ROIs in any US market.

To learn more about how the Mashvisor platform can help you make the best real estate investment decisions, schedule a demo with our team of experts.

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The Investor’s Guide to Remote Closing