It's rather complicated. Here's what is supposed to happen:
The title to a piece of real estate is recorded in the county where the property physically exists. When ownership changes, or a mortgage is originated or sold, the change in status is recorded with the county. The county charges a significant fee for this.
In an effort to reduce the cost of selling mortgages, so that they could be bought and sold more efficiently, the lenders formed a corporation just for the purpose of circumventing this. This corporation (MERS) holds all of the titles, and keeps track of the effective ownership.
Unfortunately, there was a lot of slicing and dicing, and transferring of ownership, and the title records were handled sloppily. Now that it is becoming necessary to foreclose on many of these properties, it is being discovered that the record keeping on many is not in order.
This is causing a big problem with the foreclosure process nationwide, and the courts and lenders are just now realizing that they have a major problem to sort out. Some defaulting borrowers think that this should entitle them to a free home, but allowing this to happen would destroy our financial system, and real estate market.
It is possible that Congress will have to step in and resolve the mess. No matter what happens, this will cause big problems for millions of people.
After reading the replies and finally arriving at an understanding of what's occurred all I can say is.........what a dog's breakfast!
“When ownership changes, or a mortgage is originated or sold, the change in status is recorded with the county. The county charges a significant fee for this.”
This also raises tax evasion charges. Counties do not say that if a person desires to record ownership they register with the county, the counties require registration and a tax and a fee.