Disclaimer: This blog post is for informational purposes only and does not constitute legal advice. Please consult an attorney for guidance on specific laws regarding Remote Online Notarization (RON), digital signatures, and related legal matters. As laws concerning RON and notarization are subject to frequent changes, it is advisable to verify current regulations with your local government.
From buzzing startups to established enterprises, the shift to digital operations is undeniable. This includes how we sign documents. Knowing how to set up an electronic signature is essential for professionals across various industries, including health care, real estate, business, and legal, and learning this process can simplify your life and boost productivity.
This comprehensive guide explores the ins and outs of setting up and using electronic signatures. You’ll learn how to create electronic signatures, add signatures to your documents, and what makes these signatures legally binding (and not).
Understanding Electronic Signatures
Electronic signatures, or e-signatures, can offer a legal way to approve documents electronically. They can offer significant advantages over handwritten signatures, as they can eliminate printing, scanning, and faxing, reducing costs and improving efficiency.
The rise of remote work further propelled the use of electronic signatures. This has transformed workflows across businesses of all sizes and streamlined many processes for organizations that operate in different locations.
Legality of Electronic Signatures
In most cases, electronic signatures hold legal weight, thanks to the U.S. ESIGN Act and UETA (Uniform Electronic Transactions Act). These laws generally recognize e-signatures as equivalent to handwritten signatures if certain criteria are met.
Some exceptions may exist. Certain state or federal documents might require traditional, wet signatures. It’s important to consult with the relevant state and federal agencies to understand specific requirements and to verify whether your e-signatures are legally binding. For example, promissory notes on certain loans may need to be wet-signed, as well as car ownership and registration documents.
While almost all transactions are now validated electronically, physical document access might sometimes be necessary. We recommend reviewing this information and your options to choose the best signature type for your purposes.
How to Set Up an Electronic Signature
Several convenient options are available for setting up an electronic signature. This step-by-step guide shows you how to sign electronically.
Software Solutions
Dedicated e-signature platforms offer robust functionality for creating, sending, and managing electronic signatures. You can often create an account, choose a signature style, and start signing documents online using a free electronic software and easy guide.
E-signature solutions typically let you type, draw, or upload an image of your signature. This offers flexibility to match your preferences.
Microsoft Word
You can also set up and use e-signatures within Microsoft Word using e-signature tools. To set up an e-signature in Microsoft Word, navigate to the Insert tab, select Signature Line, and input the signer’s details in the pop-up window to create a digital signature field. Advanced options like third-party integrations can also enable drag-and-drop signing with audit trails, ensuring compliance, security, and a seamless user experience.
PDF Documents
For PDF documents, there are many tools that have built-in e-signature technology. However, a handwritten e-signature is often acceptable for PDFs, so a full digital signature isn’t always required.
Business and Personal Uses for Electronic Signatures
Electronic signatures offer significant advantages in both business and personal contexts.
For businesses, e-signatures expedite contract approvals and other agreements. They streamline internal workflows for managing paperwork like NDAs and purchase agreements. This convenience lets you spend more time creating electronic signatures instead of printing.
E-signatures can also enhance security. They can verify the identities of parties involved in transactions. This added layer of verification ensures document safety and integrity, as transactions increasingly move online.
E-signatures can be used for various purposes, both professional and personal. Examples include freelancer agreements, complex legal contracts, invoices, business correspondence, and even personal documents.
E-signatures vs. Online Notarization: Understanding the Difference
In the digital age, electronic signatures and online notarization have become increasingly popular as alternatives to traditional paper-based signing and notarization processes. While both concepts are related to digital authentication, they serve distinct purposes and offer different benefits. In this section, we’ll delve into the differences between e-signatures and online notarization, helping you understand when to use each.
E-signatures
Electronic signatures, or e-signatures, are digital marks or symbols attached to, or logically associated with, a document or record and used by the signer with the intent to sign the document or record. They are often used to sign contracts, agreements, and other digital documents. This can provide a convenient and efficient way to execute documents remotely.
Key characteristics of e-signatures:
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Intent to sign: E-signatures indicate the signer’s intent to agree to the terms of a document.
- Authentication: Depending on the process, E-signatures may require the signer to authenticate themselves using multi-factor authentication, or using private keys. Thic can help verify that the person signing is who they claim to be.
- Permanence: E-signatures are embedded in the document, often encrypted, making it difficult to alter or tamper with the signed document. E-signatures can remain on a document long term.
Online Notarization
Online notarization, on the other hand, is a process where a notary public witnesses the electronic signing of a document through a live, secure online video conference. This process is also known as remote online notarization (RON).
Key characteristics of online notarization:
- Live witness: A notary public witnesses the signing of the document in real-time, verifying the signer’s identity.
- Audio-visual recording: The entire process is recorded, and a a tamper-evident seal is evident on every notarized document.
- Authentication: Online notarization involves identity verification and authentication of the signer.
NOTE: online notarization uses digital signatures for the signer and notary to sign the documents, but the notarization is an added layer on top of the E-signatures.
Key Differences Between Electronic Signatures and Remote Online Notarization
There are many differences between electronic signatures and remote online notarization, including:
- Purpose: E-signatures are used to consent to a document, while online notarization is used to witness and notarize the signing of a document. An E-signature cannot take the place of an online notarization, as a notarization is often required for legal documents.
- Involvement of a notary: E-signatures do not require the involvement of a notary public, whereas online notarization requires a notary to witness the signing.
- Level of authentication: Online notarization provides a higher level of authentication and verification compared to e-signatures.
When to Use Electronic Signatures vs. Remote Online Notarization.
- E-signatures: Use e-signatures for documents that require a simple signature, such as contracts, agreements, and forms.
- Online notarization: Use online notarization for documents that require a higher level of authentication and verification, such as wills, trusts, and property deeds.
By understanding the differences between e-signatures and online notarization, you can choose the right solution for your specific needs, ensuring that your digital documents are secure, authenticated, and legally binding.
IMPORTANT: Consult a legal professional to determine if your document requires notarization and to confirm the validity of e-signatures or Remote Online Notarization (RON) in your specific case. State laws governing these practices vary, and not all jurisdictions permit their use for every type of document.
FAQs About How to Set Up an Electronic Signature
How do I create an electronic signature?
You can create an electronic signature through various methods. These include dedicated e-signature software, Microsoft Word add-ins, and built-in PDF tools. Online tools offer flexibility by allowing you to type, draw, or upload a scanned image of your signature.
What is the primary difference between Remote Online Notarization (RON) and electronic signatures?
RON involves a live audio-video session with a commissioned notary who verifies identities and witnesses document signing remotely, while electronic signatures alone only authenticate a signer’s agreement without third-party validation. RON adds legal notarization through secure platforms like NotaryCam, whereas e-signatures (e.g., typed names, digital stamps) lack notarial oversight.
When should I use RON instead of a basic electronic signature?
Use RON for documents requiring notarization by law (e.g., affidavits, deeds, powers of attorney), as it provides tamper-evident seals and recorded sessions for legal compliance. Electronic signatures suffice for non-notarized agreements like contracts or consent forms where only authentication of intent is needed.
How do security features compare between RON and electronic signatures?
- RON: Often uses multi-factor authentication, credential analysis, knowledge-based authentication, and session recordings for more robust security.
- Electronic signatures: Can rely on basic encryption and audit trails but lack live identity verification.
Conclusion
In today’s digital world, electronic signatures are rapidly becoming the standard for document execution and approval. They simplify business and personal transactions, offering enhanced efficiency and ease of use. By leveraging electronic signatures, you can adapt to the ever-changing technological landscape and optimize your workflows.
Earlier, we discussed the differences between Remote Online Notarization (RON) and electronic signatures. While RON involves a notary public witnessing the electronic signing of a document, electronic signatures are used to execute and consent to a document. By understanding the distinct purposes of these digital tools, you can choose the right solution for your specific needs.
Embrace the convenience and security of electronic signatures, and discover a more efficient way to execute documents. Create digital signatures, set up electronic signature options with various software, and improve document security with e-signatures. Start signing your paper documents electronically today and save time!