What Is a Remote Closing?

The traditional closing process — buyers, sellers, notaries, agents, and attorneys passing around paperwork and pens — isn't your only option for finalizing a home sale. A remote closing, also known as an e-closing or online mortgage closing, is the process of finalizing a real estate transaction partially or entirely online. Remote closing can be convenient, or even necessary if you’re out of state or otherwise unable to attend in person.

This article explains how remote closing on a house works, which states allow it, what to expect from the process, and how to prepare to help ensure everything goes smoothly.

How does remote closing work?

In real estate, closing, or settlement, is the process of signing all necessary documentation to finalize the transaction. After closing, you officially become the owner of your new house and take responsibility for the mortgage.

Remote closing uses a technology called remote online notarization (RON), which incorporates secure video technology and anti-fraud measures to complete notarization electronically.

A remote closing follows the same general steps as a traditional closing, though all or most of the process happens online. Here’s how it typically works:

• Receive closing documents: You receive closing documents digitally from your lender — you need to review these before signing. Necessary documents typically include a closing disclosure, loan application, transfer deed, promissory note, deed of trust or mortgage, and escrow disclosure. 
• Prepare the necessary paperwork: Gather any necessary information, documentation, and paperwork ahead of signing. You’ll typically need proof of payment, proof of insurance, and a government-issued ID.
• Sign paperwork: Depending on the type of remote closing, you’ll either sign all the paperwork remotely or meet with a notary for ink or electronic signatures.
• Pay closing: Closing costs are paid via cashier’s check or wire transfer (buyers), or out of the sale proceeds (sellers). Verify all payment information before handing over the money.
• Get your keys: After closing, you’re officially the owner of your new house. You can get the keys by in-person pick-up, agent delivery, or mail.

According to TJ Tassone, mortgage broker and owner ofat Tayton Capital, LLC, virtual closings are becoming more commonplace. 

"Normally, virtual closings make sense if you aren’t readily available to go into a title office to sign," Tassone says. "However, as virtual closings get easier, you do it from home, work, or vacation. This speeds up the closing as well by turning what normally is an hour into 30 minutes or less."

Read more: 30 Mortgage Terms to Know: Ultimate Glossary for Homebuyers

Where is remote closing available?

The availability of remote closing is, well, all over the map. A majority of states and the District of Columbia have passed laws authorizing some form of remote online notarization, but the state-by-state details can get tricky. Depending on the state where the property is located, remote closings may be:

• Not permitted at all for real estate transactions
• Specifically excluded under current RON laws
• Allowed by state law, but not yet fully implemented by regulators
• Unavailable if local mortgage lenders, title companies, or county registries still require in-person signatures

However, the regulatory landscape can always change. States could approve new RON laws, or repeal existing ones. Also, federal legislation called the SECURE Notarization Act, which would allow remote notarization nationwide regardless of current state-level regulations, has been introduced in Congress.

Check with your real estate agent, mortgage lender, or attorney to find out if your state allows remote closings — and if any limitations or exceptions apply.

Read more: Understanding the Timeline: How Long Does It Take To Close on a House?

What types of remote closings exist?

Not all remote closings happen entirely online. Here are the three types of remote closings and how they work.

Fully remote closing

In a fully remote closing, everything is signed electronically. A fully remote closing requires the lender, title company, and all involved parties to accept digital documents. 

Hybrid closing

A hybrid closing involves a combination of digital and in-person signatures. You sign most of the documents electronically, but then you meet with the closing agent or notary for documents that require a physical signature.

In-person e-notarization

In-person e-notarization (IPEN) is a process where all of the documents are signed digitally and notarized electronically. However, unlike RON, the signer and notary are in the same physical location. 

What are the pros and cons of remote closing?

Remote mortgage closings have their benefits, making it possible to close on a home without all parties being physically present. But there are a few drawbacks, too. The following are some of the major pros and cons of remote mortgage closings:

Details on the pros

• Convenience: A remote closing can save you money, it can also save you the hassle of taking time off work and the logistics of being in a specific location at a specific time. 
• Efficiency: "The greatest benefit e-closings provide is a more seamless process with fewer paperwork errors and quicker completion of the documents," says Steven Min, chief credit officer at Credit One Bank. Remote closings allow buyers to review and sign documents on their own time, potentially saving hours at an in-person meeting. 
• Potential savings: If remote closing means you no longer need to travel for an in-person meeting, it can save you money on transportation, food, and lodging costs. 

Details on the cons 

• Potential for security risks and technical glitches: No internet technology is 100% secure, which means a remote closing could be vulnerable to security risks. Slow internet connections, audio or visual problems, and other glitches could also be factors. Remember, not everyone is tech- savvy.
• No face-to-face meetings: Having all parties in one room can help ensure that everyone’s on the same page and help first-time homebuyers feel more comfortable. 
• No in-person walkthrough: The closing process generally involves a final walkthrough to ensure the sellers have made any agreed-upon repairs and there’s no new damage. If you’re closing from a remote location, you may have to rely on your real estate agent to do a very thorough walkthrough or provide a virtual walkthrough.
• Not available everywhere: Though online mortgage closings have grown in popularity, fully remote closings aren’t always possible. It depends on state law, as well as the policies of the lender, title company, closing agent, and other involved parties. 

How can you prepare?

Remote closings can take some of the hassle out of the homebuying experience, but being prepared is key to a smooth closing. Here are some tips that can help:

1. Find a real estate agent familiar with remote closings

Choosing the right agent is always wise, but it might be even more important during a remote closing. Look for an agent with experience in remote closings, preferably one who's also not tech-averse. 

2. Confirm which e-closing method is allowed

Availability may depend on your state, lender, or another party involved in the transaction. Determine whether you’ll be doing a fully remote closing, a hybrid closing, or an in-person e-notarization.

3. Take security precautions

Remote closing is generally considered safe, but don't neglect your due diligence. “Use only the lender's or settlement agent's e-closing platform, opt for multi-factor authentication, and read documents before signing so that you have a chance to ask questions without feeling rushed,” says Min. “Verify wire instructions by calling an official phone number other than the one sent via email. Note that wire fraud remains a real risk in real estate transactions.”

4. Gather the necessary documentation

Make sure you have all the right information and paperwork handy before closing. This typically includes a government-issued ID, a cashier’s check or proof of wire transfer (plus your checkbook for any last-minute changes), your Closing Disclosure, and proof of insurance.

5. Review closing documents carefully

Review all closing documents carefully to make sure there aren’t any errors, and ask questions about anything that’s unclear. 

6. Test your tech

With a remote closing, technological mishaps can delay the closing process. Ensure your internet connection is strong, your devices are charged, and your webcam works before getting started.