Yesterday, we covered the questions that borrowers have that are answered by the closing disclosure. (Back track, my friends, and look at that one here.) One thing I said in the previous article is...
If a notary wants to be a great signing agent, the notary will become familiar with where in the document stack he or she can point out answers for the borrower.
Today is Note Day! Let's go over the note.
Feel free to share my favorite background music that I play as I'm creating the marked up copies of loan documents.
Here you go: "What does the Note, er, I mean FOX say?" Put the volume on high and plow in.
Just like all these guys, every document has something very specific to say.
Dog goes "Woof!"Cat goes "Meow!"Bird goes "Tweet!"andMouse goes "Squeak!"Cow goes "Moo!"Frog goes "Croak!"and the Elephant goes "Toot."Ducks say "Quack!""Fish goes "Blub."and the Seals goes "Ow, ow, ow..."But there's one sound, that no one knows...
So, what DOES the Note say?
Besides "Ring-ding-ding-ding ..." and "Hah-tee, hah-tee, hah-tee HO!"
What does that NOTE SAY?
What questions in the borrower's mind does the document with the shortest title (the note) answer?
- How much are we borrowing?
- What is our interest rate?
- When is my first payment due?
- What date are all of my payments due?
- Where do I send my payments?
- What amount is my payment?
- Is there a prepayment penalty?
When I present a note, I simply say: "Here's your note."
I go through the first page pointing out important pieces of the note puzzle.
"Here's your loan amount. There's your interest rate,
first payment date, the amount of your payment,
and of course, the address where you send your payment."
I flip to the back, show them the place for signature, straighten it back up, and hand it over.
"Please review the note. When you are ready, sign as your name exactly as printed. Let me know if you have questions"
I turn back to the stack, pick up the next document, scan it and get ready to introduce the next one.
But, just for a few moments, I am part of the video. All of the animals have morphed into loan documents...there are affidavits, agreements, and dollar signs everywhere. One day, I'll buy the rights and do a remake...I'll breathe new life into that old video.
"That's what the note says...a ring, ding, a-ding, hah-tee, hah-tee, hah-tee, HO!"
UPDATE 6/13/18 6:22 A.M. The SPW provides these guidelines. https://spswg.files.wordpress.com/2016/02/spw-signing-presentation-guidelines-2016.pdf. And the Code of Conduct here: https://spswg.files.wordpress.com/2016/02/spw-code-of-conduct-2016.pdf.
Please refer to this before you conclude that this is an "explanation" of documents.
4.5. Loan Terms
The Notary Signing Agent may identify and provide a general description of a loan or payment amount, interest rate, annual percentage rate, finance charge, payment schedule, assumption option, prepayment penalty or any other loan term to a borrower in the closing documents, but may not explain, interpret or provide legal advice about the loan terms.