SECTION 60:15-3-11. E-Recording Models

(a)   Electronic recordings, whether as pilot projects or live production initiatives, have occurred in many states. From these efforts, three distinct models have emerged. The models are referred to as Models 1, 2, and 3. Each has distinctive characteristics. Each also brings certain benefits to the submitters.

(b)   Over time the improvements in delivery methods and document formats have improved the processes as well. From scanned paper documents, to electronically signed images of the documents wrapped with XML data and securely signed, to completely electronic, XML-integrated documents using electronic and digital signatures, these models bring continuing benefits to participating county clerks and document submitters. Ongoing progress with increasing value from added benefits are expected as mortgage, legal, and recording industry standards are implemented.

(1)   Model 1 Description. This model is an extension of the paper-based closing or payoff processes. Documents are prepared and printed. The parties sign and notarize the paper documents with ink signatures. When complete, the signed and notarized paper documents are scanned and electronically sent to the county clerk. Transmission is done by the submitting parties logging on to the computer system of the county clerk over a secure network after first identifying, or authenticating, themselves to the computer of the county clerk. The county clerk makes the same determination of recordability as with paper documents, visually inspecting them for such things as signatures and acknowledgments as well as determining the recording fees. Once the county clerk accepts the documents for recording, the scanned image is permanently affixed with the recording information, including recording date and time as well as the unique recording reference number, such as book and page number or instrument number. Indexing is performed by the indexing staff of the office of the county clerk, as with paper documents. A copy of the recorded images is returned to the submitter, together with the recording endorsement data and receipt.

(2)   Model 2 Description. Model 2 recordings may be paper or electronic based. A document image whether from a scanned paper document signed and notarized by 'wet ink' signatures or from an electronic document electronically signed and notarized, is wrapped in an XML wrapper containing the data necessary for processing, indexing, and returning the document. In the case of a scanned paper document, Model 2 further extends Model 1 by adding data that improves the process, specifically the indexing process in the office of the county clerk. In the case of an electronic document, the process begins to improve for the settlement agent, lender, or loan servicer submitting the document. The model may support one or more of a number of graphics formats. The recordable electronic documents are generally delivered to the office of the county clerk by whatever means agreed to by the parties as specified in the Business Rules. Once imported into the system of the county clerk, the legacy system handles the recording functions. In this case the system imports the data from an XML wrapper, including index data. The recording process is partially automated, but the image may be visually inspected to determine that it meets recording requirements as well as possibly to validate against the data in the XML wrapper. The indexing data in the embedded image is not linked to the index data in the XML, so the county clerk has no automated means to verify that it is the same. If a document meets the requirements of the county clerk, it is recorded.

(3)   Model 3 Description. Under Model 3, documents are generated on a Trusted Business Partner's document preparation system according to the PRIA standards. The document preparation person logs on to the system and enters the information necessary to complete the generation of the document. Once the document has been generated, it is signed by an individual with the authority to sign. Secure access is required for all parties that must sign the document because signing is done by electronic signature. Once the documents are electronically prepared, they are released for recording. The document preparation system compares each document against recording rules to ensure its recordability, and then calculates recording fees. Documents are submitted to the office of the county clerk pursuant to the terms of the Business Rules of the county clerk. Documents received at the office of the county clerk are re-checked against the rules to determine whether or not they may be recorded. If not, they are returned to the submitter. Otherwise they are accepted for recording and the data for recording is extracted from the documents and passed to the legacy recording system. The endorsement data is received from the legacy system and entered onto the respective documents in XML format. If required, the XHTML is transformed to images for the archives of the county clerk and the documents with the recording endorsements are returned to the submitter.

[Source: Added at 27 Ok Reg 1369, eff 6-11-10]