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Electronic Signatures FAQ

September 07 2012

signElectronic signatures have been among the hottest technologies in real estate this year. In chatting with Prabakar Mahalingam of GoPaperless Solutions, a leading provider of electronic signatures, I was curious about what obstacles, if any, stand in the way of further industry adoption. His response: lack of information.

Real estate professionals and their clients may be reluctant to adopt this technology if they have unanswered questions. With all the benefits of electronic signatures – financial, environmental, practical – these questions should be answered. So, with Prabakar's help, I'm going to provide answers to some of the top electronic signature FAQs. These questions are primarily from the agent's perspective, however consumers share many of these concerns.

How do electronic signatures work?

There is a surprising array of different types of electronic signatures. Perhaps you've heard the term "digital signatures" tossed around – this is actually a subset of electronic signatures, one that uses a digital code that is unique to the signer and the document. Digital signatures are click-to-sign, as opposed to handwritten. Electronic signatures, unlike digital signatures, can be handwritten using a stylus. These are often called "wet" or "biometric" electronic signatures.

Need help understanding this distinction? Check out our article, Not All Electronic Signatures Are Created Equal.

Why should I implement electronic signatures?

There are many benefits of electronic signatures.

  • Environmentally-friendly. Particularly when there are so many other benefits, why wouldn't we want to be kinder to the environment by reducing waste?
  • Reducing expenses. Spend less money on paper, ink, printer toner, gas, etc.
  • Become more efficient. Spend less time driving around town to obtain in-person, pen-to-paper signatures.
  • Attract and retain customers. Electronic signatures, due to their convenience, can lead to an improved customer experience.

Are electronic signatures legally accepted?

Yes, electronic signatures are legally accepted. In fact, Mr. Mahalingam explains, "the legality of electronic signatures is protected by a Federal law that enables electronic signatures for commercial transactions across all 50 states. This Federal law is called the ESIGN Act (the Electronic Signatures in Global and National Commerce Act)."

If you do get pushback on an e-signed document, you have options. For the steps you can take, check out The Bank Rejected my E-signed Document! What Can I Do Now?

Will my broker accept it?

Given the benefits and the legally-established nature of electronic signatures, your broker should accept them. The real estate industry is leading the adoption of electronic signatures and the majority of brokers have already implemented it as part of their business. However, it's a great idea to ask them about it and if there's a technology vendor they prefer for their electronic signature solution. If they say they will not accept electronic signatures, you should explain the aforementioned benefits and legal considerations.

What will the user experience be like for my clients?

Each electronic signature solution is slightly different and offers a different user experience. However, most solutions offer an excellent user experience and achieve something very important for your clients: convenience. With their busy schedules, they'll be grateful for the flexibility that e-signed documents provide.

If you have a reluctant client, Mr. Mahalingam suggests a biometric signature solution. "Biometric, or handwritten, electronic signatures are very similar to traditional, pen-to-paper signatures. This familiarity will help less tech-savvy clients feel more comfortable with the electronic signature process."

Do I need special hardware or software?

This is a good question to ask technology vendors. Some electronic signature solutions require you to install software on your computer or, if it is a mobile solution, install an app on your tablet (such as the GoPaperless eSign iPad App). However, some solutions are entirely Web-based, which means you can use the technology on any device without installing any software (such as eSignOnline). Web based solutions, such as eSignOnline do not require any software or hardware for you or your clients. Your clients can sign on their computers, mobile phones, and tablets, any device with internet and email access.

To capture "wet" biometric electronic signatures, a touch screen device (like an iPad, Tablet PC, or Android tablet) is required. These devices offer the client to sign with an electronic stylus or even their finger.

What are the available products?

You can check out our product directory for a list of electronic signature solutions. You may also want to check with your MLS, Association, and broker to see if they have a preferred vendor.

How much will an electronic signature solution cost me?

Cost is different for each vendor and each product. Special pricing may also be available through your company or organization. Thus, we recommend having a pricing discussion individually.

"It's a great idea to ask technology companies if they have a free trial available," Mr. Mahalingam adds. "We offer a free account for our eSignOnline with five signing sessions per month. This is a great way for agents to be confident that our product is a good fit."

Can I sign any documents or only certain kinds?

Your electronic signature solution should give you the flexibility to sign any documents that are required for your business.