What Are Wet Signatures, and Are They Really Important?

September 22, 2022
By Lisa Cornwell

Legal requirements for signatures changed significantly in the past few years. While signing documents in person was once an absolute must, that’s no longer the case. Today, countless transactions occur every day where the parties signing various documents never meet in person and may be in different areas of the country or even on different continents.

What is a “Wet” Signature? 

A wet signature is exactly what the name suggests. A wet, or wet ink, signature requires the signers to use a pen, stamp, or seal to sign a document. That means the signatories must have the actual paper document. With so many documents now requiring signatures from parties in disparate locations, completing those documents is time-consuming and costly, as the signing parties must travel or send the document to several locations to allow all parties to provide their signatures.

Disadvantages of Wet Signatures

While some people still prefer wet signatures, understanding the drawbacks of the practice in a digital age must be considered. Here are only a handful of reasons governments, businesses, and private individuals are moving toward e-signatures rather than requiring wet signatures.

·      Wet signatures slow transactions of all kinds. As alluded to above, requiring wet signatures means either the signers or the documents must travel to ensure everyone signs as needed. Those delays cause problems when signatures are needed now rather than later.

·      The costs of obtaining wet signatures are higher than digital options. Office supplies, equipment, and courier fees add to the overall expenses without providing any real benefits.

·      Filing expenses are high. Documents with physical signatures must be stored safely to ensure they’re always available in the event copies or proof of signatures are required in the future. File cabinets fill up and more must be added, which means additional storage space is needed as the volume of paperwork expands.

While there are still a few situations where wet signatures may be required to avoid legal issues, e-signatures are now used for a variety of purposes. Since the onset of the pandemic, the growth in e-signature use increased significantly. Today, legally binding e-signatures are accepted throughout the U.S. and in most nations around the world.

When are Wet Signatures Still Commonly Used?

The situations where electronic signatures can’t be used are now rare, and states are rapidly enacting regulations making e-signatures legal in more settings. However, there are circumstances where wet signatures are still required. They may include:

·      Transfer of title documents. In some states, deeds and similar documents must still be signed using a wet signature. However, check with your state to determine if wet signatures are still needed.

·      Signing documents that must be notarized. Those documents may include wills, trusts, and similar paperwork. Again, the need for notarization is under pressure, and states are eliminating the requirement.

·      Loan documents from a bank or other lender. This requirement is more tradition than anything else, and lenders in many areas no longer require wet signatures, especially when dealing with clients located out of state. Always check with the lender to determine what their requirements are.

As previously noted, the recent pandemic altered the way people everywhere use electronic signatures. Even though there are fewer restrictions for meeting in person today, the impact of the isolation requirements imposed during COVID-19 substantially changed the way e-signatures are used.

What are Electronic Signatures? 

While wet signatures require a physical means of signing a document, electronic signatures do not. Electronic signatures are electronic rather than physical, and there is no need for a physical piece of paper to be signed in person. Instead, signers can be located just about anywhere in the world if they have access to an appropriate electronic device and internet service.

In a world that depends on international agreements, that’s a big plus. A variety of documents can be signed by multiple parties located in far-flung areas without having to wait for the delivery of physical copies of those documents. Time is money, and the faster documents are signed the easier it is to move forward with government, corporate, or personal business.

Understanding the Types of Electronic Signatures

Today, people everywhere use different forms of electronic signatures without even thinking about it, but not all forms of electronic signatures offer the same levels of security. For example, an electronic signature is a person’s name at the end of an email. A name keyed at the end of an electronic form is also a type of electronic signature. A pin used to access a bank account or an online site is also a form of electronic signature. When you’re asked to sign a screen when accepting a delivery, you’re creating an electronic signature. Each of these uses serves a purpose, and businesses everywhere are using e-signatures to complete transactions. However, when vital documents are signed, additional security measures are a must.

That’s where organizations like mSign come into play. Ensuring the integrity of electronic signatures is a must for crucial documents, and implementing the proper software and procedures makes it easy for organizations to increase productivity and, at the same time, take the appropriate steps to avoid legal and ethical issues. 

Explore the Pros and Cons of Electronic Signatures

While there are numerous benefits of using electronic signatures, there are also a few issues users must be aware of when adopting their use. Here are examples of the pros and cons users encounter when moving to the use of electronic signatures.

Of course, there are far more advantages to electronic signatures than there are disadvantages, so review the obvious pluses first.

·      Easy access. As noted earlier, signatories find signing electronic documents far easier than wet signing them. E-signatures prevent delays due to signers having to travel or mail documents. In addition, losing an e-document is uncommon, but mailed documents are frequently lost or delayed.

·      Digital documents are secure. When the proper software and procedures are in place, digital documents are secure. That means signers don’t have to worry about forgeries or altered documents. However, the level of security depends on the software or e-signature service provider. Take the time to ensure the integrity of any provider before using their services or software.

·      Streamlining operational processes is simplified. Automation on various levels allows businesses and other organizations to improve their workload flow. Signatures required before projects begin are collected quickly, which means any delays are minimal.

At the same time, the adoption of e-signatures draws fire from some critics. That means understanding the negative side of using electronic signature options is always important. Here are a couple of the reasons organizations face challenges when moving to a digital environment.

·      Some people simply don’t trust electronic signatures. Moving to new types of technology is often objected to by some people. Remember that wet signatures were the norm for generations, and moving to a new system isn’t easy for everyone. Helping people understand the advantages of electronic signatures is important when objections to the practice arise.

·      New technology may be required. Older hardware and software may not be capable of handling electronic signatures safely. Updating equipment and working with a new service provider to ensure security protocols are followed isn’t inexpensive. However, remember that failing to stay abreast of current trends can be even more costly. During the transition, having a wet signature backup plan in place may prove helpful.

·      Not all users will have compatible software. That’s why it’s vitally important to work with a provider who understands how to overcome compatibility issues should they occur. If you’re concerned about this type of issue and how it might impact your organization, discuss it with the mSign staff now to make sure moving to electronic signatures is right for your organization. 

These pros and cons cover the basics, but asking questions before hiring a provider like mSign will make it easier to understand why moving to electronic signatures is the appropriate solution for virtually any company.

The World is Changing

Today’s business environment is considerably different than anything people experienced in the past. More importantly, the way business is conducted in the future will certainly be far different than what we see today. That means organizations must take steps now to ensure they’re able to conduct business efficiently today and will be ready for anything the future brings.

By now it should be clear what wet signatures are and why they’re not as important as they were in the past. To keep up with today’s trends, and be ready for those ahead, now is the time to move your organization away from requiring paper-based signatures.

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