Signatures AND Initials

I have had a couple of refi packages this past week that included a note and the trust deed with the usual signature lines but also had a place to initial in the lower right hand corner on every page of both docs, including the signature pages. When I asked the borrowers to initial the signature page they look at me like I just fell off the turnip truck. “Why do I have to initial a page I just signed?” is their question. I quickly explain that’s what title wants and I move on. However, it makes me feel like I’m uninformed (which I guess I am) and a little dopey to ask them to initial a signature page. Does anyone have some enlightening thoughts on this tiny dilemma?

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Agree that the redundancy seems unnecessary, but it’s what LenderTitle wants so just do it so loan will fund. Not many do this, so you won’t see it often.

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I think it’s overkill. But suppose some agency wanted to shortcut the whole process, and only sent the signature pages to the the signers. (They would have had to find a notary to go along with such a shenanigan.) Then someone at the title company “fixes” it and adds the signer’s initial. Since the package doesn’t have any examples of the signer’s genuine initials, there’s nothing to compare it to. But with the initials and signature on the same page, there’s a presumably genuine set of initials to compare to all the other initials.

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I suspect the initial lines are just part of the document footer so they print on every page, even the signature pages. Problem is that whoever reviews the docs when they come back to the title company or lender expects all initial lines to be initialed even though it would be redundant.
Far easier to just have the borrowers initial all lines rather than fight with the TC or lender over whether initials are needed on a signature page. That’s how I would explain it to the borrowers.

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I don’t think you should feel dopey, it’s not like you created the docs. I do hate when loan docs make the signer initial every page of the deed (like people actually read all of that!) it feels like it takes forever.

I just don’t understand why some signers complain so much.

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I believe that the initial lines are simply to establish that the signer has actually read or reviewed that page. We already know that they’re not going to read line for line but this minimizes the liability for the lender by having them to initial simply to imply they agreed to the terms and stipulations in the document. In a lawsuit they would never be able to get away with saying “I did not know or no one told me”. When you initialed the document you are saying that you read it and approved…

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I understand the point you’re making, however, I’ve been an expert witness in the financial services arena for nearly 40 years and I have learned something about those complex documents that nobody reads, like the deed of trust.

When documents like deeds of trust, signature agreements for bank accounts, consumer protection disclosures and the like, are handed to a consumer for their signature or initials, it is generally understood that it is not commercially reasonable for the signer of such documents to read or fully understand the contents of the document or agreement.

If the foregoing is a generally accepted truth or rule of conduct, as the title companies must surely know, then what good is it to have the parties initial each page of a document they’ll never read nor understand? The question is rhetorical.

In the end, it seems foolish to me to get initials on all 17 pages of the average deed of trust when the only thing that really counts is the signatures on the last page, notarized. All the reasons for initials I’ve heard and read here are perfectly reasonable and I get it. But, as notaries, with all the stuff we’re responsible for, it seems so silly to me when someone from title or escrow calls and says, “You missed an initial in page 11 of the deed of trust. Will you go back and get it for us?” My bad for missing it in my post-signing review, I guess. Wow.

Some companies want initials on each page. Used to be all the time but many companies have stopped it because of the number of pages missed. I still have a couple local banks that want it. Not unusual.

Not sure how the rest of you conduct your closings (and it’s not my business) but when I did them I followed the procedure my attorney-boss in CT used to use - I presented the docs by title and got signatures…however for the Note and Mortgage, I went over every page - pointing out the paragraph headings so people knew what they were signing - did not enter the realm of UPL, did not give advice or definitive definitions, just paragraph headings. Initials at the bottoms of the page for both note and mortgage were not unusual at all, and I was comfortable knowing my signers knew what each document contained.

IMO signers have the right to see the entire document they’re signing and agreeing to - ESPECIALLY the note and mortgage.

JMO

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Bobby, I think you gave the right answer. I usually say “the short answer is because that is what your lender wants so we need to give it to them or we will be signing it again later”. The long answer is also because that is what the lender wants and because they want you to acknowledge not necessarily that you have read every page but you are agreeing to every page.

While what you are saying I believe is true that it is understood that the documents will not be fully understood or read completely, it is also true that the Deed of Trust, Note, etc are also Uniform Instruments and therefore it is understood that you are agreeing to a Uniform Standard and Government Regulated Document that everyone else agrees to as well.

That being said, I always point out what is not uniform in those documents and is unique to them which is generally highlighted in black bold print or in Italics, such as loan amount, Vesting, Lender, Maturity, etc.

Answering “why” questions is not your job. Have them call escrow, or their LO.

I worked for mortgage companies in the past and we were trained to go over our loan documents in quite detail, including every paragraph on the note and deed. We also had to be licensed (at that time it was a real estate license). This could be why pages were initialed, but I don’t recall if ours were. I agree it’s overkill to initial the same page you’re signing but it’s the lender’s decision, and that’s all I would say.

As a notary, I am not licensed (nor paid appropriately) to go into details and discuss loan documents. And I guarantee you most notaries are not, nor should they have to be. That is the responsibility of the lender and their loan officers. The clients should already know well in advance the loan terms and in my opinion, should have received an advance copy of all documents being signed prior to the notary appointment. If there are questions about the documents, it should be before the signing. I believe this industry will eventually have to become accountable this way.

I wasn’t aware about the clause you stated below, which makes sense, as well as Steinbergnsa’s comments on “Uniform instruments” being agreed to.

Bottom line, tell them that if that’s what title wants, that’s what title gets so they get their loan. I joke and tell them they don’t want to have to invite me back to dinner to get it signed… They always laugh.