In Georgia, we’ve always bought and sold homes with face-to-face, across-the-table interaction between buyers, sellers, lenders and the closing attorney. In fact, the Supreme Court of Georgia has ruled that the process must be handled by a Georgia-licensed attorney. I have worked as a Georgia closing attorney for over 36 years, and like the other closing attorneys across the state, I take the responsibility seriously. For most Georgians, their home is generally the largest investment they make in their lifetime.
So it’s very troubling to me to see Georgia lawmakers pushing a bill that would drastically change real estate closings by allowing them to be conducted online, by out-of-state companies, using all digital signatures. It’s an ill-conceived proposal that will leave Georgia consumers with little to no protection.
A new homeowner would get nowhere trying to get help from that company in Pennsylvania or New York if the online closing doesn’t go right. Also, while this proposal would potentially make it easier to buy and sell loans in the market, it’s the Georgia consumer who would bear the cost and the risk if there’s no Georgia attorney overseeing the process to make sure the title is good, the transfer of title is done correctly, and the buyer and seller understand what they are signing.
And if there’s no Georgia attorney involved, there’s no one to inform a homebuyer that Georgia has a “non-judicial foreclosure” process, meaning that it is very easy for a lender to foreclose in Georgia without going to court. In recent years the financing of home loans has become more and more about a product that is bought and sold in the secondary market. We all remember the mess caused by the industry’s need for loans to be bought and sold in the early 2000s. Making it easier for the industry isn’t necessarily making it better for the Georgia consumer.
I am all for innovation. There have been countless technology improvements over my 36 years of closing transactions. But we need to take our time and get this one right because there is too much at stake.
Until there is a proper way to maintain our current safeguards, we should exempt real estate closings from this bill and from the one-click digital world. HB334 is currently pending in the state Senate, where our senator holds the powerful position of majority leader. Sen. Mike Dugan — who is committed to policies that improve the lives of Georgians — would serve us well by standing up for consumers and demanding changes to this legislation before it moves forward.
Owning a home is part of the American Dream. Done right, it’s an investment that can provide stability and wealth building. Done wrong, it could lead to financial hardship that many would never overcome.
Phillip Wilkins, an attorney in Carrollton, is a partner at Tisinger Vance, P.C.