The legal industry has a bit of a reputation for being resistant to change. And in some cases, it’s justly earned. Sometimes we do things simply because it’s the way things have always been done.
But if your firm is still compiling physical closing binders — or your attorneys are spending far too much time on the project management part of a transaction — you should know that there’s a better (i.e. faster, easier, and vastly more effective) way to handle it.
A closing binder is the final, definitive record book of the legal transaction, complete with a closing binder index, and all the fully-executed transaction documents, which is distributed to the involved parties after closing. The purpose of the closing binder is to ensure all parties have access to the terms of a deal and other relevant information.
Traditionally, assembling the closing binder was a massive physical project — documents were printed, scanned, copied, organized, tabbed, and compiled into actual three-ring binders which then had to be delivered to the client.
But this kind of arduous physical process is ill-suited to the demands of modern business.
Many transactional attorneys are discovering their work is often less about legal expertise and more about managing details.
The increasing demands of transactional closings have a major effect on law firms, causing as train on time and a reduction in profits. These challenges come from a variety of places.
Effective transaction management requires attorneys to have expertise in each of the following:
All of these expectations contribute to lengthy time commitments in order to close a legal transaction. In order to press through to closing with all the required filings, funding and documentation often requires months.
Adding to the complexity, the typical deal involves an array of parties. This requires moving massive piles of documentation around to multiple entities with the goal of maintaining consistency in communication.
On top of all this complexity is an increased pressure to move quickly. Today’s pace of business is faster than ever. Attorneys feel the time pressure to move closings forward, therefore spending long hours poring over documentation.
With all of the complexity and pressure, transactional attorneys spend a lot of time focusing on the project management aspect of the closing.
The process typically involves three aspects:
The traditional closing process provides no clear-cut way for collaboration. All communication funnels around disparate parties without a singular place to refer to. While the goal is to review and collaborate, you have no easy way to search and find specific locations in the closing documents.
The result is a major waste of time on repetitive and manual tasks, emails, and status update meetings. This process creates high costs in labor and paper — not to mention unbillable attorney hours.
Fortunately, many law firms are finding a simpler and faster way to complete closings. The key to moving past the slow traditional process is taking the closing digital. Each of the three components to closing can be greatly improved with a digital workflow.
Removing the need for constant back-and-forth emails, document version controls, and update meetings can significantly impact the time attorneys and fee earners spend on non-billable tasks. This time commitment is why the traditional “closing room” is dying and moving to a faster digital environment.
NetDocuments provides a seamless opportunity for transactional law firms to move a transaction from intake to closed. To find out how, request a demo and learn how your firm can take its first steps into the digital closing process.
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