Common Mistakes to Avoid When Using eSignatures
- Amila Udowita
- 4 days ago
- 8 min read
Electronic signatures have transformed the way businesses handle contracts, agreements, and approvals. What used to take days of printing, mailing, and waiting can now be completed in minutes from any device. The global eSignature market is expected to surpass $14 billion by 2026, reflecting how central this technology has become to modern operations.
But speed and convenience come with a catch. Many businesses rush into eSignature adoption without fully understanding the legal, security, or procedural requirements that make a digital signature enforceable. A single misstep can render a contract unenforceable, expose sensitive data, or create compliance headaches that cost far more than the time saved.
This guide covers the ten most common eSignature mistakes businesses make, explains why each one matters, and gives you clear steps to avoid them.
Why Getting eSignatures Right Matters More Than You Think
A valid eSignature is not just a checkbox or a scanned image of a handwritten name. To be legally binding in the United States, an electronic signature must meet the requirements of the Electronic Signatures in Global and National Commerce Act (ESIGN) and the Uniform Electronic Transactions Act (UETA). Internationally, frameworks like eIDAS in the European Union impose additional requirements, particularly for high-stakes transactions.
When something goes wrong with an eSignature, the consequences can include voided contracts, legal disputes, regulatory fines, and reputational damage. Understanding the most common pitfalls is the first step to protecting your business.
10 Critical Mistakes to Avoid with Electronic Signatures
Mistake 1: Using the Wrong Type of eSignature for the Job
Not all eSignatures are the same. Many businesses treat electronic signatures as a single, interchangeable technology, but there are three legally recognized tiers, each suited to different levels of risk and document sensitivity.
Simple, Advanced, and Qualified eSignatures Explained
A Simple Electronic Signature (SES) is the most basic form. It includes things like typing your name at the bottom of an email or clicking an "I Agree" button. It is appropriate for low-risk, internal documents where the identity of the signer is not in dispute.
An Advanced Electronic Signature (AES) is uniquely linked to the signer, capable of identifying them, and created using data that only the signer controls. It is suitable for business contracts, NDAs, and financial agreements.
A Qualified Electronic Signature (QES) is the highest tier, backed by a qualified certificate from an accredited trust service provider. Under eIDAS in the EU, a QES carries the same legal weight as a handwritten signature. It is required for notarized documents, real estate transactions in some jurisdictions, and government contracts.
Using a simple eSignature for a document that legally requires a qualified one can void the agreement entirely. Always assess the risk level and jurisdictional requirements before choosing your signature type.
Mistake 2: Overlooking Jurisdiction-Specific Legal Requirements
eSignature law varies significantly by country, state, and even document type. One of the most frequent and costly errors businesses make is assuming that because eSignatures are legal in their home country, they are automatically valid everywhere.
The ESIGN Act and UETA in the USA: In the United States, the ESIGN Act (2000) gives eSignatures the same legal standing as handwritten signatures for most commercial transactions. The UETA, adopted by 49 states, reinforces this at the state level. However, both laws contain exclusions. Wills, testamentary trusts, adoption papers, divorce decrees, court orders, and certain real estate documents may still require wet signatures depending on the state.
eIDAS Regulations for Cross-Border Transactions: For businesses operating across the European Union, the eIDAS Regulation establishes a unified legal framework for electronic identification and trust services. Under eIDAS, a QES is legally equivalent to a handwritten signature in all EU member states. If your contracts involve European parties, failing to use the correct signature tier can expose you to enforceability challenges in EU courts.
The fix is straightforward: always consult your legal team or a compliance expert before deploying eSignatures for international contracts, and document the applicable law that governs each agreement.
Mistake 3: Skipping or Weakening Identity Verification
A signature is only as trustworthy as the process used to verify who signed it. Many businesses send eSignature requests with no identity verification beyond an email link. While this is convenient, it creates a significant legal vulnerability. If a signatory later denies signing a document, and you have no verification of records beyond an email delivery log, your position in a dispute is very weak.
Best practices for identity verification include:
Two-factor authentication (2FA) via SMS code or authenticator app before signing
Knowledge-based authentication (KBA) for higher-risk documents
Government ID verification through your eSignature platform
Video verification for the highest-stakes agreements
Requiring signatories to confirm their email access and agree to use eSignatures before proceeding
The level of verification you implement should match the risk level of the document. A standard employment offer letter has different requirements than a multimillion-dollar business acquisition agreement.
Mistake 4: Failing to Maintain a Proper Audit Trail
An audit trail is a timestamped record of every action taken on a document from creation to completion. It captures who viewed the document, when they opened it, what IP address they used, and when and where they signed. Without a comprehensive audit trail, an eSignature is almost impossible to defend in court.
Many businesses either choose platforms that do not generate robust audit trails, or they fail to store and protect these records after signing. A good audit trail should include:
Timestamp of when the document was sent
Timestamp of when each party viewed the document
IP address and geolocation data for each signing event
Device and browser information
Timestamp of when each signature was applied
Any declined or voided signing events
Certificate of completion generated by the platform
Reputable eSignature platforms such as Falkon Sign, DocuSign, Adobe Acrobat Sign, and HelloSign automatically generate these records. Always verify that your platform's audit trail meets the evidentiary standards in your jurisdiction.
Mistake 5: Applying eSignatures to Documents That Require Wet Signatures
Despite the broad acceptance of eSignatures, there is a category of documents that still require a handwritten signature (wet signature) in many jurisdictions. Using an eSignature on these documents can render them legally void.
Documents that commonly require wet signatures include:
Wills, codicils, and testamentary trusts
Adoption papers and guardianship documents
Certain real estate deeds (varies by state)
Court orders and judicial documents
Negotiable instruments such as checks
Some insurance policies depending on state law
Documents requiring notarization (unless your state allows remote online notarization)
Before rolling out eSignatures for any new document category, consult with legal counsel familiar with your specific jurisdiction to confirm the document type is eligible for electronic execution.
Ready to get eSignatures right?
Book a free 15-minute consultation with our team to review your current eSignature workflow.
Mistake 6: Not Obtaining Proper Informed Consent
Under the ESIGN Act, parties must affirmatively consent to doing business electronically before an eSignature can be considered legally binding. This consent cannot be implied. It must be explicitly given, and the signer must be informed of their right to withdraw consent and receive a paper version of the document if they prefer.
Common consent mistakes include:
Embedding consent language in dense terms-and-conditions text that signatories are unlikely to read
Failing to provide a clear opt-out mechanism for those who prefer paper
Not documenting that consent was given and when
Using pre-checked boxes rather than requiring an active opt-in
The solution is to present a clear, standalone consent disclosure before any document is signed. Keep the language simple and make sure signatories actively confirm their agreement to use electronic records.
Mistake 7: Choosing an Insecure or Non-Compliant Platform
Not every eSignature tool on the market is built to the same standard. Some free or low-cost platforms may not offer tamper-evident document sealing, strong encryption, or the audit capabilities required for legal defensibility. Choosing the wrong platform is one of the most consequential mistakes a business can make.
When evaluating an eSignature platform, look for:
SOC 2 Type II certification for data security
ISO 27001 compliance for information security management
HIPAA compliance if you operate in healthcare
21 CFR Part 11 compliance for pharmaceutical and life sciences firms
End-to-end encryption and at-rest data encryption
Tamper-evident sealing using PKI-based digital certificates
Comprehensive audit trail generation and export capabilities
Data residency options if you have international compliance needs
Investing in a certified, reputable platform is far cheaper than the liability that comes from using an insecure one.
Mistake 8: Poor Document Preparation Before Sending
A surprisingly common eSignature mistake happens before the signature process even begins: sending a document that is not properly prepared. Incomplete fields, unclear signing instructions, missing initial fields, and poorly placed signature blocks all cause confusion, delays, and sometimes invalid completions.
Document preparation best practices include:
Clearly designate signature fields, initial fields, date fields, and any required text fields
Assign each field to the correct signer so documents with multiple parties do not get confused
Proofread the document thoroughly before sending (eSignature platforms do not catch legal errors)
Set an expiration date on signing requests to avoid unsigned documents sitting indefinitely
Use field validation to require completion of mandatory fields before signing is allowed
Send a test run to yourself before deploying a new template to clients or partners
Mistake 9: Neglecting Secure Post-Signing Document Storage
The signing process does not end when the last party signs. What happens to the completed document afterward is just as important. Many businesses download signed documents and store them in unsecured folders, personal email accounts, or shared drives with no access controls. Others simply forget to download and back up completed documents at all.
Secure post-signing storage requires:
Encrypted storage with access controls limiting who can view each document
Automatic backup to prevent data loss
A retention policy that complies with industry regulations (e.g., HIPAA requires six-year retention for medical records; SEC Rule 17a-4 mandates seven-year retention for broker-dealer records)
Tamper-evident storage so any unauthorized modification to the signed document is detectable
A clear retrieval process so documents can be produced quickly in the event of a legal dispute
Many enterprise eSignature platforms include built-in document management and storage. If yours does not, integrate it with a secure document management system (DMS) that meets your industry's retention and security standards.
Mistake 10: Failing to Train Your Team on eSignature Protocols
Technology is only as effective as the people using it. Even the best eSignature platform cannot protect you if your team sends documents to the wrong recipients, uses incorrect templates, bypasses verification steps to save time, or fails to recognize phishing attempts disguised as eSignature requests.
A proper eSignature training program should cover:
How to prepare and send documents using your platform correctly
Which document types are and are not eligible for eSignatures
How to verify the identity of signatories before sending
What to do if a signing request is declined, bounced, or expired
How to recognize fraudulent eSignature emails (a growing phishing vector)
Compliance requirements specific to your industry
How to locate and retrieve completed documents and their audit trails
Training should not be a one-time event. As regulations evolve and your eSignature platform releases new features, ongoing education keeps your team aligned with best practices.
Final Thoughts: Getting eSignatures Right Is a Business Imperative
Electronic signatures are no longer a convenience, they are a core part of how modern businesses operate. When implemented correctly, they accelerate deal cycles, reduce administrative overhead, and create a seamless experience for everyone involved. But when handled carelessly, they introduce legal uncertainty, compliance risks, and security vulnerabilities that can undermine even the most important agreements.
The difference comes down to discipline. Choosing the right type of signature, verifying identity appropriately, understanding jurisdictional requirements, and maintaining a defensible audit trail are not optional steps, they are the foundation of a valid and enforceable digital agreement.
As your organization continues to adopt and scale eSignature workflows, the goal should not just be speed, but confidence. Every signed document should be something you can stand behind in a legal, regulatory, or business context without hesitation.
By avoiding the common mistakes outlined in this guide and establishing clear internal protocols, you ensure that your eSignature process is not just fast, but secure, compliant, and built to last.
Comments