Posted on 03/06/2011 7:25:28 PM PST by Palter
FOR more than a decade, the American real estate market resembled an overstuffed novel, which is to say, it was an engrossing piece of fiction.
Mortgage brokers hip deep in profits handed out no-doc mortgages to people with fictional incomes. Wall Street shopped bundles of those loans to investors, no matter how unappetizing the details. And federal regulators gave sleepy nods.
That world largely collapsed under the weight of its improbabilities in 2008.
But a piece of that world survives on Library Street in Reston, Va., where an obscure business, the MERS Corporation, claims to hold title to roughly half of all the home mortgages in the nation — an astonishing 60 million loans.
Never heard of MERS? That’s fine with the mortgage banking industry—as MERS is starting to overheat and sputter. If its many detractors are correct, this private corporation, with a full-time staff of fewer than 50 employees, could turn out to be a very public problem for the mortgage industry.
Judges, lawmakers, lawyers and housing experts are raising piercing questions about MERS, which stands for Mortgage Electronic Registration Systems, whose private mortgage registry has all but replaced the nation’s public land ownership records. Most questions boil down to this:
How can MERS claim title to those mortgages, and foreclose on homeowners, when it has not invested a dollar in a single loan?
And, more fundamentally: Given the evidence that many banks have cut corners and made colossal foreclosure mistakes, does anyone know who owns what or owes what to whom anymore?
The answers have implications for all American homeowners, but particularly the millions struggling to save their homes from foreclosure. How the MERS story plays out could deal another blow to an ailing real estate market, even as the spring buying season gets under way.
(Excerpt) Read more at nytimes.com ...
MERS, via NYT.
Look at the investors list, pensions, hedge and mutual funds, a bond that is supposed to be a safe investment, but you’ll never know until the un-bundling proves the mortgages are being paid.
What a mess. So glad my place is paid for.
MERS saves people money and allows for people to get cheaper interest rates. Does it make any sense for a lender to record an assignment each time a loan is sold? That only benefits the county clerk’s office. The only reason people complain about MERS is this: they are trying to find an excuse, any excuse, not to pay what they owe. It really is just that simple. How many stories do you read of MERS foreclosing on a home where the debt is current? Answer: none.
Baloney!!!
I complain about MERS because there is a good chance that my loan title is now MUDDIED, as in NOT CLEAR, bozo! Gads, what a bunch of self appointed pompous malarkey! I want clear title when we pay this off, and MERS screwed it up.
Besides, you are being factually disingenous. Common law that goes back for more than 400 years REQUIRES the assignments be recorded. The banks were just trying to skate on billions owed to local counties, the thieves.
And YOU KNOW ALL THIS, SHILL!!!
Spreading your lies around, keep the sheeple misinformed, eh?
Barf!!!
MERS saves people money and allows for people to get cheaper interest rates. Does it make any sense for a lender to record an assignment each time a loan is sold? That only benefits the county clerk’s office.Since I already know how to drive, there is absolutely no need for me to fill out an application for a drivers license which would only benefit a state office. If later on I'm told that it's the law to get a driver's license, I'll just claim it's a minor paperwork snafu, backdate my application, and have my cousin the cop swear under penalty of perjury that I passed my driving test months ago.
How many stories do you read of MERS foreclosing on a home where the debt is current? Answer: none.Wrong answer. http://www.google.com/search?&q=wrong+house+foreclosed+on
JUST great GOOGLY moogly wow!
You want the rest of us to subscribe to a system that does not record or verify an orderly and legal transfer of property ownership in order to save a few dollars on the largest investment most Americans ever make?
A few years ago a freeper sugessted to me that circumventing the legal process may have allowed the banks to sell one mortage to gullible buyers many times over.
At the time I thought that preposterous.
I no longer think that is proposterous.
Of course it makes sense. At the county clerk's office each state has an established method of recording the ownership and mortgages against the property. With MERS they pretend to have that record keeping and do not actually take title to the property but pretend to be able to transfer title to a new owner.
The issue with MERS is not forclosure, but the question of ability to convey clear title to the new owners. Legally that issue is questionable and in some states it is clearly not according to title law.
How many stories do you read of MERS foreclosing on a home where the debt is current? Answer: none.
Wrong. There have been cases where Banks proceeded with forclosure proceedings to individuals with no mortgage on the home.
This is a real mess and there is no simple solution to the problem with faulty title conveyance. Just ask someone in the title insurance business what they think of MERS. All the title insurance companies have changed their practices to protect themselves from the flaws in this mess.
Post 6 nails it - all the complaints and allegations the electronic records of mortgage documents and transfers is just a way debtors are using to try from paying for the properties they signed and bought. The lawyers are phonying up class actions against the banks on alleged bad electronic records to cash in, just like in the tobacco suits.
Meanwhile federal courts and most state courts have gone to electronic filing and publication of decisions. All of us owning stock and mutual funds have our ownership in electronic form. Our checks, bank statements and credit card bills are all electronic. If those are trusted, why the yelling on mortgages?
Oh, another mortgage shill.
“...all the complaints and allegations the electronic records of mortgage documents and transfers is just a way debtors are using to try from paying ...”
Nope. The issue of clear title is a valid concern.
Are YOU going to guarantee my mortgage is free and clear?
No???? Gee, why not?
Purposeful misleading baloney, shill.
You? An apololgist for MERS?! You should be ashamed!
What did MERS do to protect citizens? When did MERS represent conservative values?
I paid off my mortgage—fully, in certified check at $61,000—and MERS and the banks refuse to offer a clear and free title. They blame it on “the system”. For 14 months now, MERS circles here and back&forth, but no bank provides a free and clear title. Nor a quit claim deed.
There is NOTHING in MERS that any Conservative could respect.
You? An apololgist for MERS?! You should be ashamed!
What did MERS do to protect citizens? When did MERS represent conservative values?
I paid off my mortgage—fully, in cash at $61,000—and MERS and the banks refuse to offer a clear and free title. They blame it on “the system”. For 14 months now, MERS circles here and back&forth, but no bank provides a free and clear title. Nor a quit claim deed.
There is NOTHING in MERS that any Conservative could respect.
I agree that MERS is trying to reduce mortgage transaction costs. Conceptually I think it is a great idea. Practically, MERS has run into the wall of local control and impediments to reduction of mortgage transaction costs. Conceptually, reducing mortgage transaction costs should not be dissimilar from many other areas. Practically, mortgages are one of the areas of tight local control, resistant to reduction of transaction costs.
State governments have plenty of barriers to trade. Mortgages and auto transactions are primary areas of barriers to trade. Consumers pay a heavy price for these barriers. Consumers could save substantial sums by the ability to purchase an auto directly from a dealer. Local car dealerships are powerful political groups that refuse to allow consumers to deal directly with manufacturers and regional dealerships. The mortgage area is similer. There are powerful local interests (both industry and government) that do not want reduced transaction costs. MERS has miscalculated about its ability to overcome the resistance from local control.
When you secure a debt through real property, the law has required for centuries it be recorded in county courthouses.
This is not a "technicality". This is our land title system. You don't follow the law in this respect you lose your right to take the collateral.
I stand by my post. Commercial loan originators have saved millions of dollars but not having to record assignments. Lenders that are MERS members offer $30-$50 off the price of closing a loan as a result. MERS is a win-win for everyone. MERS wasn’t created to screw people. I’m sorry if that answer doesn’t comport with your pre-conceived notions.
As for paying off your mortgage — first of all, a lender/servicer would not give you a “quit claim” deed. A lender would simply provide a “Release of Lien” or “Release of Deed of Trust” or whatever is customary in your jurisdiction. Under most states’ statutes, both lenders and servicers can be liable to the borrower/grantor for failure to cancel a lien release within 60-90 days of full payment. If you need to obtain a release of lien, you should provide a written demand to the lender. If the lender fails to comply, send a letter to the attorney general with a copy of the letter you sent the lender.
“MERS saves people money and allows for people to get cheaper interest rates. Does it make any sense for a lender to record an assignment each time a loan is sold? That only benefits the county clerk’s office.”
A lot of things may not make sense (this one actually does so you know who owns the home) but the law is the law. Do you pick and choose what laws make sense?
MERS has been used in all 50 states. There are legal opinions for counsel in each of these states asserting MERS’ legality.
But according to the law in hundreds of jurisdictions they did have to record assignments if they wish to take action against the property . That's the problem.
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