NSA Managing the Signing Assignment — Questions and Answers

Question 1: When a signing agent receives a loan package and discovers several documents are missing, what is the correct first step?

Proceed with signing the available documents and note the missing ones
Contact the title company or lender immediately to report the discrepancy (Correct answer)
Cancel the appointment and inform the borrower
Ask the borrower to sign blank spaces where missing documents would go

Correct answer: Contact the title company or lender immediately to report the discrepancy

The NSA must notify the hiring party immediately when documents are missing so corrections can be made before or during the appointment.

Question 2: A borrower asks the NSA to explain whether a particular loan term is favorable for them. The NSA should:

Provide an honest assessment based on current market rates
Explain the term as written in the document without giving an opinion
Refer the borrower to a financial advisor and postpone signing
Decline to answer and suggest the borrower call their lender (Correct answer)

Correct answer: Decline to answer and suggest the borrower call their lender

NSAs must direct borrowers' substantive loan questions to the lender, as giving advice constitutes unauthorized practice of law or financial advising.

Question 3: What does 'confirmation of appointment' typically require an NSA to verify before traveling to a signing?

That the borrower has already reviewed all documents online
That the loan has been fully funded by the lender
The appointment time, location, contact information, and document delivery method (Correct answer)
That the title company has received the signed deed of trust

Correct answer: The appointment time, location, contact information, and document delivery method

Confirming the appointment details—time, location, contact, and how documents will arrive—prevents unnecessary trips and ensures a smooth signing.

Question 4: If a borrower is unavailable at the scheduled signing time due to an emergency, the NSA should:

Leave the documents with a household member to sign later
Wait up to two hours and then return the package unsigned
Contact the hiring party to report the situation and await instructions (Correct answer)
Reschedule directly with the borrower for the next available slot

Correct answer: Contact the hiring party to report the situation and await instructions

The NSA must report the failed appointment to the hiring party who will decide how to proceed, not make independent rescheduling decisions.

Question 5: Which of the following best describes the NSA's role regarding the Right to Cancel (Notice of Right to Rescind)?

Explain the rescission window and advise the borrower whether to cancel
Ensure the borrower receives the required number of copies and signs the acknowledgment (Correct answer)
Determine whether the loan is subject to the right of rescission
File the rescission notice with the county recorder if the borrower wishes to cancel

Correct answer: Ensure the borrower receives the required number of copies and signs the acknowledgment

The NSA ensures the borrower receives the correct number of copies and signs the acknowledgment form; interpreting or advising on rescission is outside the NSA's scope.

Question 6: When shipping a completed loan package back to the title company, the NSA should:

Use the least expensive shipping method available to keep costs low
Use the shipping method and carrier specified by the hiring party (Correct answer)
Retain copies of all documents before shipping
Ship only the notarized documents and leave unsigned copies with the borrower

Correct answer: Use the shipping method and carrier specified by the hiring party

The NSA must follow the hiring party's specific shipping instructions, including carrier, service level, and tracking requirements.

Question 7: An NSA notices a discrepancy between the borrower's name on the identification and the name printed on the loan documents. The correct action is to:

Notarize the signature using the name on the ID only
Allow the borrower to sign both names on each document
Note the discrepancy and contact the hiring party for guidance before proceeding (Correct answer)
Strike through the incorrect name and write the correct one before notarizing

Correct answer: Note the discrepancy and contact the hiring party for guidance before proceeding

Name discrepancies must be reported to the hiring party before the NSA proceeds, as corrections require authorization from the lender or title company.

Question 8: What is the primary purpose of the Closing Disclosure (CD) in a real estate transaction?

To authorize the NSA to collect the down payment from the borrower
To provide the borrower with final loan terms and closing costs at least three business days before closing (Correct answer)
To transfer title of the property from the seller to the buyer
To certify that the property appraisal meets the lender's requirements

Correct answer: To provide the borrower with final loan terms and closing costs at least three business days before closing

The Closing Disclosure is a federally required form that gives borrowers final loan terms and costs, and must be delivered at least three business days before consummation.

Question 9: During a signing, a borrower crosses out a clause on one of the loan documents before signing it. The NSA should:

Allow the change if the borrower initials next to the strikeout
Stop the signing and immediately contact the hiring party to report the alteration (Correct answer)
Proceed with notarizing the document since the borrower has the right to modify it
Have the borrower write a separate letter explaining the modification

Correct answer: Stop the signing and immediately contact the hiring party to report the alteration

Borrowers generally cannot unilaterally alter loan documents; the NSA must halt and notify the hiring party because unauthorized changes can void the transaction.

Question 10: What does a 'wet signature' requirement mean in the context of a loan signing?

The borrower must sign in blue or black ink only
Original physical signatures are required on the actual paper documents (Correct answer)
The documents must be signed in the presence of two witnesses
Electronic signatures are acceptable as long as they are notarized

Correct answer: Original physical signatures are required on the actual paper documents

A 'wet signature' refers to an original ink signature on a physical document, as opposed to an electronic or digital signature.

Question 11: An NSA is asked to notarize a document for a borrower who is signing under a Power of Attorney. What must the NSA confirm?

That the attorney-in-fact is a licensed attorney
That the POA document is valid, current, and covers the transaction, and that the lender has approved its use (Correct answer)
That the property owner has been notified of the signing
That a second notary is present to co-sign the notarization

Correct answer: That the POA document is valid, current, and covers the transaction, and that the lender has approved its use

The NSA must verify the POA is valid and lender-approved before proceeding, as not all lenders accept a POA for real estate transactions.

Question 12: Which of the following is the NSA's responsibility when a borrower states they did not receive a copy of the loan documents before the signing appointment?

Provide the borrower with copies from the signing package to review immediately
Reschedule the signing until the borrower can review documents in advance
Inform the hiring party and proceed according to their instructions (Correct answer)
Cancel the signing because federal law requires advance document delivery

Correct answer: Inform the hiring party and proceed according to their instructions

The NSA should report the situation to the hiring party, who will determine how to proceed based on loan type and applicable disclosure timelines.

Question 13: In the context of a signing assignment, what is a 'straw buyer' situation, and how should an NSA respond?

A buyer who uses gift funds for the down payment; proceed normally
A person acting as buyer on behalf of another to circumvent lending rules; refuse to notarize and report the suspected fraud (Correct answer)
A first-time homebuyer unfamiliar with the process; provide extra guidance
A buyer who purchases raw land; use a different document set

Correct answer: A person acting as buyer on behalf of another to circumvent lending rules; refuse to notarize and report the suspected fraud

A straw buyer arrangement is mortgage fraud; NSAs who suspect it must refuse to participate and report it to the appropriate authority.

Question 14: After completing a signing, the NSA's call-back report to the hiring party should include:

The borrower's credit score and debt-to-income ratio as observed from the documents
Confirmation that signing is complete, any issues encountered, and the return shipping tracking number (Correct answer)
A recommendation on whether the loan should be approved based on the signing
The exact loan amount and interest rate to confirm accuracy

Correct answer: Confirmation that signing is complete, any issues encountered, and the return shipping tracking number

The call-back report keeps the hiring party informed of completion status, any problems, and return shipment details so the transaction can proceed to funding.

Question 15: Which document in a mortgage loan package transfers the borrower's interest in real property to the lender as security for the loan?

Promissory Note
Closing Disclosure
Deed of Trust or Mortgage (Correct answer)
Settlement Statement

Correct answer: Deed of Trust or Mortgage

The Deed of Trust (or Mortgage, depending on the state) pledges the property as collateral and is recorded in the county land records.

Question 16: An NSA arrives at a signing and the borrower is visibly intoxicated. The NSA should:

Proceed if the borrower insists they are competent to sign
Delay 30 minutes and reassess the borrower's condition
Stop the signing, contact the hiring party, and document the situation (Correct answer)
Have a sober witness present during the signing to validate competency

Correct answer: Stop the signing, contact the hiring party, and document the situation

A notary cannot notarize for a person who appears to lack capacity; the NSA must halt the signing and report to the hiring party.

Question 17: What is the significance of the 'funding date' vs. the 'closing date' in a real estate transaction?

They are always the same day in all transactions
The closing date is when documents are signed; the funding date is when the lender releases loan proceeds (Correct answer)
The funding date precedes the closing date in all purchase transactions
The closing date determines when property taxes are prorated

Correct answer: The closing date is when documents are signed; the funding date is when the lender releases loan proceeds

Closing is the signing event, while funding occurs when the lender disburses funds, which may happen the same day or after the rescission period on refinances.

Question 18: If a signing package contains two versions of the same document with different figures, the NSA should:

Have the borrower sign both versions so the lender can choose
Sign the most recently dated version and discard the other
Halt the signing and contact the hiring party for clarification (Correct answer)
Ask the borrower which version matches what they were quoted

Correct answer: Halt the signing and contact the hiring party for clarification

Conflicting document versions indicate a package error that must be resolved by the hiring party before any signatures are obtained.

Question 19: What is the purpose of an 'errors and omissions' (E&O) insurance policy for an NSA?

To cover the borrower's legal fees if the loan transaction fails
To protect the NSA from claims arising from mistakes made during the course of notarial duties (Correct answer)
To reimburse the lender for losses caused by mortgage fraud
To provide coverage for documents lost during shipping

Correct answer: To protect the NSA from claims arising from mistakes made during the course of notarial duties

E&O insurance protects the NSA financially if a clerical error or oversight during the signing results in a claim or lawsuit.

Question 20: During a refinance signing, the borrower realizes the interest rate on the Note differs from what they were quoted. The NSA should:

Advise the borrower to sign and dispute the rate later with the lender
Confirm the borrower's concern, stop the signing, and contact the hiring party (Correct answer)
Recalculate whether the difference is within an acceptable tolerance and proceed if so
Strike through the incorrect rate and write in the quoted rate before notarizing

Correct answer: Confirm the borrower's concern, stop the signing, and contact the hiring party

Any discrepancy between quoted and document figures must be reported to the hiring party immediately; the NSA cannot advise on or alter loan terms.

Question 21: Which of the following best describes the NSA's obligation regarding borrower privacy during and after a signing?

The NSA may share signing details with other real estate professionals as a networking practice
The NSA must keep all borrower information strictly confidential and not discuss details of the transaction with third parties (Correct answer)
Privacy obligations end once the signed package is returned to the title company
The NSA may retain copies of all documents for their own records for up to seven years

Correct answer: The NSA must keep all borrower information strictly confidential and not discuss details of the transaction with third parties

NSAs handle sensitive personal and financial information and are obligated to maintain strict confidentiality throughout and after the assignment.

NSA Managing the Signing Assignment

When a signing agent receives a loan package and discovers several documents are missing, what is the correct first step?

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