I don’t know about you but this is an awful lot of dollars. Meanwhile they are cutting budgets in some places such as California and just last week in Chicago!
I’m still puzzled how no conflict of interest exist when MERS is named a defendant with the borrower in a foreclosure suit??
Well here is your answer COUNTIES!!!
The suits, filed in Nevada and California district courts, claim the company has deprived county and state governments of revenue “used among other things to maintain county real property records, fund the judiciary, school systems and other government services.”
“They tout themselves as being a recording-fee avoidance scheme,” said attorney Robert R. Hager of Nevada law firm Hager & Hearne, which has filed the suits against MERS.
“If a loan is registered on the MERS system, it will save the financial institution involved in that loan from paying recording fees. MERS claims to have saved at least $2.4 billion in recording costs that would have otherwise gone to a county where the property is located. This system is depriving counties of fees legitimately owed them and contributing to the financial deficits that many local governments are currently experiencing,” he said.
MERS spokeswoman Karmela Lejarde on Friday called both suits “baseless” and pointed out that the attorney generals of both California and Nevada refused to accept them as false claims cases, essentially forcing Hager & Hearne to file civil suits.
“These same law firms have brought many other lawsuits against MERS and every one has failed,” she said. The MERS website further claims the MERS system is approved by Fannie Mae, Freddie Mac, Ginnie Mae, the Federal Housing Administration and Veterans Affairs, and the California and Utah housing finance agencies, as well as all of the major Wall Street rating agencies.
“The statement that any of our cases against MERS have failed is a lie,” Hager said. “It is true that we have other active cases involving them, but none have failed.”
According to its website, MERS “streamlines” the mortgage process for the mortgage banking industry by electronically registering mortgage loans for lending institutions. The company currently has about 2,500 clients or “members,” Lejarde said. The members list reads like a who’s who of the mortgage banking industry, including Bank of America, Countrywide Home Loans and Citimortgage, all three of which are named as co-defendants in the suits.
The MERS website also claims that since 1997, more than 63 million home mortgages have been registered on its system. “These include loans delivered to Fannie Mae, Freddie Mac, Ginnie Mae, all major conduits and state housing authorities,” the website states.
According to the company, once a loan is registered in its system, MERS acts as the mortgagee in all county land records for the lender and servicer, even though it does not actually own or lay any claim to any of the mortgages.
“Any loan registered on the MERS System is inoculated against future assignments,” the company website states, “because MERS remains the nominal mortgagee no matter how many times servicing is traded.”
The lawsuits claim this means that lenders are able to avoid recording fees every time individual mortgages are bought, traded and sold by banking institutions. As a byproduct, borrowers never know who actually holds their individual loans.
“Falsely recording MERS as the beneficiary on their deeds of trust creates an oversimplified, illusory and false chain of title that purports to justify payment of less money in recording fees; depriving the counties and the state from those fees …. [S]uch identification creates the illusion of a recorded chain of title whereby the actual creditors and/or loan beneficiaries remain hidden from public record,” the suits claim.
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