Once upon a time, in a country not so far away ...
MERS was founded in 1995 under the pretext that it would lower the cost of recording an assignment of ownership in county land records. By the way, as someone that has bought property in multiple states the filing fee is the lowest cost in acquiring a home. If you cannot afford the tiny fee in recording the deed then you probably shouldn’t be buying a home. The reality of course is MERS allowed for the mortgage backed security business to explode since it allowed mortgages to be shipped off to Wall Street to be minced into tiny tranches and sold off by the big investment banks to pensions, foreign investors, retail investors, and everyone else that wanted a piece of the mortgage bubble.
The New York Times had an excellent graphic of the MERS system dating back to April of 2009:
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Mortgage Electronic Registration Systems (MERS): A System Designed to Create the Mortgage Back Security Bubble. -- Dr. Housing Bubble
Here's what MERS says about themselves, and their streamlining enterprise. Who needs all that complicated Mortgage paperwork anyways?
About MERS [Mortgage Electronic Registration Systems, Inc.]
MERS was created by the mortgage banking industry to streamline the mortgage process by using electronic commerce to eliminate paper. Our mission is to register every mortgage loan in the United States on the MERS® System.
Beneficiaries of MERS include mortgage originators, servicers, warehouse lenders, wholesale lenders, retail lenders, document custodians, settlement agents, title companies, insurers, investors, county recorders and consumers.
MERS acts as nominee in the county land records for the lender and servicer. Any loan registered on the MERS® System is inoculated against future assignments because MERS remains the mortgagee no matter how many times servicing is traded.
Well there is another view of the "services" they provide. Here's what Delaware's AG says about MERS, in a suit he filed against them yesterday:
MERS mortgage registry sued by Delaware attorney general
by David McLaughlin, Margaret Cronin Fisk and Phil Milford, washingtonpost -- Oct 27, 2011
“MERS engaged and continues to engage in a range of deceptive trade practices that sow confusion among consumers, investors and other stakeholders in the mortgage finance system, damage the integrity of Delaware’s land records, and lead to unlawful foreclosure practices,” Biden [Delaware Attorney General Beau Biden said in a complaint filed today].
[...]
Banks and investors have the true economic interests in the loans, and the ownership of the mortgage notes is purportedly recorded in the MERS registry, to which the public has limited access, according to Biden. Biden said the system is “frequently inaccurate.”
‘Harms Consumers’
“The unreliability of the MERS System, when compounded with MERS’s reliance on the records in the MERS System, is deceptive and harms consumers by permitting and encouraging foreclosures for which the authority has not been fully determined and may not be legitimate,” the attorney general said.
Talk about your "compare and contrast" exercises ...
Here's what County Registrar's are saying around the country, regarding the MERS ignorance of local state Deed Recording laws, fees, and taxes:
MERS? It May Have Swallowed Your Loan
by Michael Powell and Gretchen Morgenson, The New York Times -- Mar 06, 2011
[...]
MERS's legal troubles, however, aren't going away. In August, the Ohio secretary of state referred to federal prosecutors in Cleveland accusations that notaries deputized by MERS were signing hundreds of documents without any personal knowledge of them. The attorney general of Massachusetts is examining a complaint by a county registrar that MERS owes the state tens of millions of dollars in unpaid fees.
Here is what Courts are ruling about Tax evasion resulting, from the MERS method.
MERS Getting Crushed in Oregon
Three Rulings Against MERS in February Alone
by Daniel Edstrom, DTC Systems, Inc. -- March 7, 2011
Brent Hunsberger from the Oregonian has reported that hundreds of Oregon foreclosure sales have been stopped after judges’ rulings. Two rulings are from October 2010, but three rulings were from February 2011. Apparently Oregon has a law requiring all intervening assignments be recorded. This appears to be a problem since MERS was specifically designed to hide the beneficial ownership of the loan and to avoid the payment of taxes on the transfer or assignment of the loan.
Here is what Courts are asking about the 'legal authority' MERS claims, when initiating and re-assigning its Mortgage Foreclosure clout:
Oregon woman, representing self, halts BofA foreclosure in court
by Brent Hunsberger, The Oregonian -- October 08, 2010
However, King [U.S. District Judge Garr King] noted that courts, including a U.S. Bankruptcy judge in Oregon, have said MERS was "more akin to that of a straw man than to a party possessing all the rights given a buyer." The Oregon judge, Elizabeth Perris, concluded Aug. 24 that under Oregon law, MERS was not a beneficiary of the deed, raising questions about whether it had authority to take steps to start foreclosure proceedings.
Here is what MERS says about 'its own' Rules on Foreclosure re-assignment powers. Who needs all that dusty paperwork, anyways? County Registrars of Deeds are so last-millennium ...
MERS FORECLOSURE & BANKRUPTCY
[...]
Rule 8 requires a Member to instruct one of its MERS Signing Officers (also referred to as MERS Certifying Officers) to execute an assignment of the mortgage lien from MERS to the servicer or a third party selected by the Member. The assignment must be executed by the MERS Signing Officer prior to the initiation of the foreclosure proceeding.
[...] Please click here to access the Rules of Membership, and reference the Rule 8 requirements.
OK, I clicked ...
MERSCORP, INC. RULES OF MEMBERSHIP TABLE OF CONTENTS
RULE 3 -- OBLIGATIONS OF MERS -- Page 15
Section 3. (a) Upon request from the Member, Mortgage Electronic Registration Systems, Inc. [MERS] shall promptly furnish to the Member, in accordance with the Procedures, a corporate resolution designating one or more officers of such Member, selected by such Member, as “certifying officers” of Mortgage Electronic Registration Systems, Inc. to permit such Member
(i) to release the lien of any mortgage loan registered on the MERS® System to such Member,
(ii) assign the lien of any mortgage naming MERS as the mortgagee when the Member is also the current promissory note-holder, or if the mortgage is registered on the MERS® System, is shown to be registered to the Member,
(iii) to foreclose upon the property securing any mortgage loan registered on the MERS® System to such Member,
(iv) to take any and all actions necessary to protect the interest of the Member or the beneficial owner of a mortgage loan in any bankruptcy proceeding regarding a loan registered on the MERS® System that is shown to be registered to the Member,
(v) to take such actions as may be necessary to fulfill such Member’s servicing obligations to the beneficial owner of such mortgage loans (including mortgage loans that are removed from the MERS® System as a result of the transfer thereof to a non-Member),
(vi) to take action and execute all documents necessary to refinance, amend or modify any mortgage loan registered on the MERS® System to such Member,
(vii) endorse checks made payable to MERS to the Member that are received by the Member in payment on any mortgage loan registered on the MERS® System that is shown to be registered to the Member.
more
MERS Membership does have its privileges [just enter B and click search]
It reads like a Who's Who of the Top 1 Percent.
Remember, Delaware Attorney General Beau Biden alleges MERS has been bilking the rest of us 'ordinary consumers':
MERS engages in ... deceptive trade practices ... sow confusion among consumers ... is deceptive and harms consumers by permitting and encouraging foreclosures for which the authority has not been fully determined and may not be legitimate.
Well here's how MERS actually "assists" Homeowners, who find themselves trapped in voice-mail mortgage hell:
MERS for Homeowners [FAQ]
WHY DO YOU NEED TO KNOW THE IDENTITY OF YOUR SERVICER?
HOW CAN I FIND OUT THE IDENTITY OF MY SERVICER?
WHAT IS A SERVICER?
The servicer is YOUR mortgage company. {wait a minute, I was told MERS held the Mortgage?} It is the company that handles the day-to-day tasks associated with managing your loan. Their duties include but are not limited to:
-- Collecting and remitting loan payments
-- Responding to borrower inquiries
-- Making advances when required
-- Accounting for principal and interest
-- Holding funds for payment of property taxes and hazard insurance (also called Managing your escrow account)
-- Making any physical inspections of the property
-- Counseling delinquent mortgagors
-- Supervising foreclosures and property dispositions in case of defaults
After your mortgage loan closed, your lender more than likely outsourced the job of managing your loan to another company called a SERVICER. This is the company you call when you have questions about your loan. {ah OK, so that's what you call "transparency" of Public Records, huh?}
WHERE CAN I GET MORE INFORMATION ON MY LOAN OR THE BASICS OF OBTAINING A MORTGAGE?
HOW DO I INFORM MERS THAT MY PERSONAL INFORMATION IS INACCURATE ON A MERS SYSTEM?
FREQUENTLY ASKED QUESTIONS ON DISPUTING YOUR PERSONAL INFORMATION
Here's MERS home office:
Location [with Map]
MERS
1818 Library Street, Suite 300
Reston, VA 20190
It just might be an interesting place "to Occupy" ... assuming Underwater Homeowners (and those foreclosed folks too) really wanted to bring a Mega Spotlight to this Monopoly Money issue. Do not pass Go. Do not collect $200 ...
Say HELL-LOO! to MERS -- the enabler of Tax Evasion and our 21st century Mortgage 'Hot Potatoes' ...
... 'Tag, Were It!'