I posted an article about MERs earlier this month. For those too lazy to click on the link here is a brief excerpt from the prior article:
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.
The Arkansas Supreme Court ruled last year that MERS could no longer file foreclosure proceedings there, because it does not actually make or service any loans. Last month in Utah, a local judge made the no-less-striking decision to let a homeowner rip up his mortgage and walk away debt-free. MERS had claimed ownership of the mortgage, but the judge did not recognize its legal standing.
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I was contacted by MERS today with a press release regarding a new lawsuit in favor of MERS, I was given permission to post the press release on Value Walk. It will be interesting to see how this all plays out. Read the press release below:
Wyoming Court Rules In Favor of MERS
Judge affirms company’s ability to assign based on terms of mortgage
Reston, Virginia, March 23, 2011—The U.S. Bankruptcy Court for the District of Wyoming ruled last week in favor of Mortgage Electronic Registration Systems, Inc. (MERS), upholding the company’s ability to take any action required of a lender, including assigning the mortgage.
In the case of In re Martinez, Judge Peter J. McNiff found that when the borrowers signed their mortgage, they had expressly given MERS the authority to assign it. The court granted Ocwen Loan Servicing’s motion for relief from automatic bankruptcy stay.
In its decision, the Court cited to similar rulings from Utah and Massachusetts which found that through the mortgage, MERS was given the authority to take any action required of the lender.
“This court finds this position persuasive in light of the applicability of fundamental mortgage law and the Debtors agreeing to and granting MERS the authority, as provided in the Mortgage,” wrote Judge McNiff in his March 16 decision. “The court finds that MERS had authority to assign the mortgage on behalf of Taylor [Bean and Whitaker], and as provided in the Mortgage, to ‘take any action required of Lender.’”
“Not only did Judge McNiff confirm that MERS holds broad powers to act on behalf of a lender, but that he also took the time to cite other recent rulings that reached the same conclusion ,” said MERS spokesperson Karmela Lejarde. “Together with rulings this year alone from courts in New York, Massachusetts, Georgia, Hawaii, New Hampshire, California, Utah and Kansas, the Wyoming decision continues to confirm the legality of MERS’ role in the mortgage.”
To download a copy of the ruling, please click here.