Contributor: Ron GitterHow it is…
Things have changed significantly over the past few years when it comes to the time line of a transaction. Technology has sped up the process to the point of absurdity, raising expectation levels of how quickly a deal can done, to something approaching a drag race between the attorneys, with the brokers holding the checked “go” flag. There are always ebbs and flows, and when the market softens, as it eventually will, things will go back to some version of normal.
The End of Ink
One good example of how quickly things musts be done, is how a contact gets signed today. In the old days, once the parties completed the negotiations, the buyer would be expected to deliver four originals of the contract, together with the deposit check. The need for so many originals must have originated many years ago, before photocopy machines, when additional originals were actually needed. In the vast majority of deals, at least in Manhattan, original documents are now the exception and not the rule. Most contracts are delivered by fax or scan, with the check delivered separately to the seller’s attorney. Managing agents and banks don’t require an originally signed copy of the contract, so there is really no need for an original signature. In many cases, logistics demand electronic signatures due to the time constraints of the deal or the location or unavailability of one of the parties. Without any doubt it is a more efficient way of both getting the contract signed and delivered. Some attorneys still require an original document, but it just an old school habit that is not long for the world.
What if There’s a Dispute?
Even if there is litigation, in most cases, the court relies on copies of the documents, unless there is an authenticity issue, which does not occur very often. Accordingly, a party should not be concerned if a document is signed as a PDF only, as custom and usage broadly accepts this format.
Speeding up the Process
Along these lines, almost all transaction and loan documents should be signed electronically and in advance of the closing in order to save time. Except for a few documents, such as a deed, promissory note and mortgage, and other transfer related documents, most of the closing documents could be signed in advance electronically, which would cut the time of a closing from the usual painful two hours (or longer), to less than an hour. Unfortunately, most managing agents are unbearably analog, so digitizing the closing process is a long way down the road.
About Ron Gitter:
I am a practicing attorney with offices in Manhattan, focusing primarily on real estate, business and commercial matters. Over the past 30 years, I have handled hundreds of co-op and condo transactions throughout the greater New York metropolitan area and have a reputation for solving problems and getting complicated transactions done.
CoopandCondo.com is a resource blog for purchasers, sellers and owners of co-ops and condos in New York City. My goal is to demystify the process, so that my readers are able to make informed decisions when it comes to all facets of co-op and condo transactions and ownership. Articles from the blog have been cited or featured online in Huffington Post, curbed, brickunderground, NYTimes online, serviceyoucantrust, theapplepeeled, habitatmag and a variety of other web and print publications. I am also a contributor on residential real estate matters for NY1, a regional television news station in New York City.
I am a member of the New York State Bar Association and its related Committee on Condominiums and Cooperatives.
For more information about my firm, I can be reached at (212) 826-2405 and by E-mail at email@example.com.