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WBK Industry News - State Regulatory Developments

Ohio Amends Foreclosure Procedures and Passes Bill to Enact the Notary Public Modernization Act

In December 2018, the Governor of Ohio signed into law Ohio House Bill 480 and the House of Representatives passed Ohio Senate Bill 263.  The first of these bills amends the foreclosure procedures in the state, while the second bill, once it is signed by the governor, would enact the Notary Public Modernization Act (Act).

The Ohio House Bill 480, among other things:

  • amends Ohio’s foreclosure procedures by changing the minimum number of days an auction must stay open for bidding from seven days to seven calendar days and further explains that the day the auction is first open for bidding is excluded from this count;
  • states that an announcement for the online foreclosure sale should be made on the auction website and shall remain posted there until at least the end of the seven-calendar-day bidding period;
  • establishes that when a residential property is ordered to be sold pursuant to a residential mortgage loan foreclosure action, regardless of whether the sale will be a physical or online sale of residential property, and if the property remains unsold after the first auction, then a second auction shall be held and the property shall be sold to the highest bidder;
  • establishes that when a residential property is ordered to be sold pursuant to a residential mortgage loan foreclosure action, the first day an online auction is open for bidding shall be considered the date of the auction;
  • requires that a contract agreement for the sale of real property at multi-parcel auction contain a statement between the owner or owners of the real or personal property and the auctioneer, auction firm, or special auctioneer attesting that the type of auction will be a multi-parcel auction; and
  • requires that all advertisements for a multi-parcel auction, excluding road signs, state that the auction will be offered in various amalgamations.

Senate Bill 263, which has not yet been signed into law by the Ohio Governor but was passed by the Ohio House and Senate, enacts the Notary Public Modernization Act.  The Act does the following as it relates to electronic notarizations:

  • establishes that an electronic document that is signed in the physical presence of the notary public with an electronic signature and notarized with an electronic seal shall be considered an original document;
  • establishes that a printed copy of a document executed electronically by the parties and acknowledged or sworn before a notary acting pursuant to Ohio law, shall be accepted by county auditors, engineers, and recorders for purposes of approval, transfer, and recording;
  • defines online notarization as a notarial act performed by means of live two-way video and audio conference technology that conforms to the standards adopted by the Secretary of State;
  • requires the Secretary of State to adopt rules necessary to implement, set, and maintain standards for online notarizations and online notaries public;
  • states that a notary public who has been duly appointed and commissioned in Ohio, and who is a resident of Ohio, may apply to the Secretary of State to be authorized to act as an online notary public during the term of that notary public’s commission;
  • requires that a notary inform the Secretary of State of the hardware and software that the notary intends to use to carry out electronic notarizations;
  • authorizes an online notary public to perform online notarizations if the online notary public is an Ohio resident and the notary is located within the geographical boundaries of the state at the time of the online notarization; and
  • requires that an online notary public use technology that meets the Secretary of State standards, take reasonable steps to ensure the integrity, security, and authenticity of online notarizations, create and maintain complete recording of the audio-video communication that is the basis for identification of a principal for each online notarization; and maintain electronic journals with specified details of all online notarizations performed by the online notary.

The Act also provides the following more general amendments to the notarization process:

  • requires that a person qualifying to be a notary public demonstrate to the Secretary of State that he or she submitted a criminal records check report completed within the preceding six months in accordance with Ohio law and completed an educational program and passed a test administered by entities authorized by the Secretary of State;
  • requires that the Secretary of State oversee the processing of notary public applications and the creation and maintenance of the online database of notaries public commission in the state;
  • requires that all submissions to the Secretary of State for receiving and renewing commissions, or notifications made under Ohio Sec. 147.05, be done electronically;
  • states that the Secretary of State may adopt rules to set forth procedures for investigation and hearing regarding violations of the rules established by the Notary Public Modernization Act;
  • requires that a notary inform the Secretary of State if the person is convicted of or pleads guilty or no contest to any disqualifying offense or any offense under the existing or former law of Ohio, any other state, or federal law that is substantially equivalent to such a disqualifying offense during the term of the notary’s commission;
  • requires that the Secretary of State maintain a database of notaries public on a publicly accessible website; and
  • amends the statutory short forms of acknowledgement, forms of acknowledgement set forth by the state of Ohio that may be used and are considered sufficient to be in compliance with the Notaries Public and Commissioners.

Senate Bill 263 also amends the Ohio real estate broker definitions to cover certain activities done by oil and gas land professionals and amends the Ohio motor vehicle title law to exempt from the requirements of notarization and verification both a certificate of title and an application for a salvage certificate of title.

The full text of House Bill 480 may be found here, and the full text of Senate Bill 263 may be found here.