MERS | RI Legislation to require clean chain of title for residential properties heard in Senate, House committees

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MERS | RI Legislation to require clean chain of title for residential properties heard in Senate, House committees

MERS | RI Legislation to require clean chain of title for residential properties heard in Senate, House committees

Attorney General cites mortgage recording irregularities in requesting bill

STATE HOUSE — Citing the irregularities with the recording of mortgages and assignments that negatively impact municipalities and consumers, Attorney General Peter F. Kilmartin has requested the introduction of legislation to require that all transfers of a mortgage interest on residential property be recorded to provide a clean chain of title.

The legislation, (2013-S0547) sponsored by Sen. William Conley (District 18, East Providence, Pawtucket) and (2013-H5512) sponsored by Rep. Brian Patrick Kennedy (District 38, Hopkinton, Westerly), was scheduled to be heard before both the Senate Committee on Judiciary and House Corporations Committee today.

The legislation makes it easier for borrowers and regulators to determine who owns loans secured by mortgages on Rhode Island property. Borrowers facing foreclosure will be able to more easily discover who owns their loans before it is too late, and municipalities will be able to identify lenders who are responsible for abandoned homes. The legislation will alter the practice of having the vast majority of mortgages held in the name of a private registry with no interest in the loans known as Mortgage Electronic Registration Systems, Inc., or “MERS.”

Since 1997, the banking industry has been using MERS, which lenders claim has minimized their administrative and financial burdens of the recording process. However, this practice has basically privatized the local land recording process, thereby undermining the accuracy of public records and leading to negative consequences for consumers and municipalities.

“Rhode Island has experienced a record number of foreclosure and short sales since the mortgage crisis,” said Representative Kennedy, “This legislation will assist homeowners in knowing who maintains the note on their property while also ensuring that local cities and towns will know the potential owner of a property after a forced sale has occurred, to ensure that municipalities have the proper information available on the documentation for taxation and municipal recording fees.”

“With this legislation, we are taking another step toward easing the pain of the housing and mortgage foreclosure crisis, which has affected both the state’s municipalities and individual consumers,” Senator Conley said. “It is common sense to record these transfers and take out the unnecessary middle man. Rhode Islanders need to know exactly who they are dealing with and how they can protect themselves. The foreclosure process is tough enough already without adding the frustration of MERS.”

“The changing of servicing and subservicing rights within the lending history often leaves the borrower confused regarding which entity they are supposed to be dealing with on a monthly basis and why,” said Attorney General Kilmartin. “The legislation is designed to give borrowers a public record of who ultimately owns their loans, increasing the ability of homeowners to negotiate with their lenders and their ability to have full knowledge of their rights, counterclaims and defenses if they are faced with litigation.

By having a nominee entity listed as the mortgagee, the banking industry has privatized Rhode Island’s mortgage recording system, and left the accuracy of public land records at the mercy of a private company’s database. Federal banking authorities have already concluded that the private mortgage system contains numerous inaccuracies and has not been accessible to homeowners. Moreover, the nominee frequently has no contractual relationship with the actual noteowner, despite the contention in the mortgage documents of a nominee relationship.

Not only has this private system deprived cities and towns the recording fees that they are owed for over 15 years, it has also hampered the ability of municipalities to adequately address abandoned property and nuisance issues because the mortgagee liable for these issues is not clear from the chain of title.
Consumers are adversely impacted due to the fact that their mortgage loans change hands multiple times through the life of the loan without proper recording. The lack of a contemporaneous public record hampers their ability to deal directly with their lenders and enforce their legal rights.

The banking industry’s practice of using a nominee entity process for recording deeds has become a highly litigated issue by consumers, municipalities and counties throughout the country. This very issue is currently being litigated in Rhode Island with private citizens and municipalities calling into question the legality of using the nominee process to record mortgage interests. The multitude of legal issues surrounding the nominee process has caused confusion and delay in foreclosure proceedings in our State, and has raised the critical issue of whether a nominee entity can enforce the power of sale. High Courts in other States, including Massachusetts and Washington, have already ruled that a nominee cannot utilize the power of sale. This legislation resolves this issue in Rhode Island by simply eliminating the nominee recording process and restoring accuracy and transparency to the public land records.

“The housing and mortgage foreclosure crisis in Rhode Island and the country did not happen overnight,” added Kilmartin. “It is going to take time, as well as reforms to existing systems like MERS to right the housing market and to eliminate past bad practices from happening again.”

For more information, contact:
Larry Berman, Communications Director for the Office of Speaker Gordon D. Fox
State House Room 331A
Providence, RI 02903
(401) 222-2466

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3 Responses to “MERS | RI Legislation to require clean chain of title for residential properties heard in Senate, House committees”

  1. no names, please, we're in litigation says:

    If you were foreclosed on in RI during 2006-2007 by Nicholas Barrett Assoc. or Orlans Moran, there’s a good chance the affidavits and assignments in your case are fraudulent. That’s because these fine firms were award-winning users of Lender Processing Services’ predecessor Fidelity Information Systems or whatever it was LPS called itself back then. I promise: Google the signors and you’ll find the people who put the ROBO in robosigning!

  2. This should about undo the ponzie reason for having MERS and stop MERS from its shell game and harm to our land records.
    CLICK ONTO THIS AND YOU WILL SEE SENATOR ROGER WASHINGTON SENATOR GOODMAN STATE ” THEY DON’T KNOW WHO THE LENDER WAS”? NOTICE THEY ARE CHUCKLING THAT THEIR ARE CONS TESTIFING TO THIS BS BILL. THEY TOLD US BY EMAIL NOT TO COME!!!! THE BANKERS AND TITLE COMPANIES ARE ALMOST JUMPING OUT OF THEIR SEATS TO SEE THIS BILL PASS. THIS IS GREAT FOR THEIR THEFT OF THE STOLEN HOUSE. SEND A LETTER TO WHO? AND IF THE LENDER DOES NOT DISPUTE IT [SOMETIMES THEY DON’T EVEN KNOW WHO THE LENDER WAS!!!!! AND “SOMETIMES THEY DON’T DISPUTE IT! “NO DISPUTE NO ONE KNOW WHO THE LENDER WAS!CANT FIND THEM DUE TO THE NOTES ARE SUPPOSEDLY IN THE SECURITIES POOLS. THIS WILL FIX THEIR MESS THIS WILL ENABLE THE THIEVES TO SELL THE STOLEN HOUSES AND STOLEN NOTES THAT THE BANKS ARE ALREADY PAID FOR WHEN THEY SUPPOSEDLY CASHED THEM GOT PAID AND PUT THEM INTO THE PSA’S BUT YOU AND I KNOW THEY NEVER GOT TRANSFERRED THEY GOT DESTROYED TO EVADE SECURITIES FRAUD. JUST LISTEN TO THIS BS. THIS IS THE FIRST MEETING ON THIS BILL WE WERE TOLD NOT TO SHOW UP TO.
    http://www.tvw.org/index.php?option=com_tvwplayer&eventID=2013021143#start=6475&stop=106
    Here is a link that begins with Stuart Halsan’s testimony.
    http://www.tvw.org/index.php?option=com_tvwplayer&eventID=2013031076#start=4699
    This is a video of a Washington state senate meeting in Olympia. WA, I and several others were told by Senator Goodman not to show due to the bill was going to be pulled due to it being a bad bill, they had this meeting without us, I believe on purpose. On the second video you will see the attorney for the title association admit there are no notes. He admits the problem lies in the securities pools. He admits if you expect to sell a house by reconvayence with an authentic note You will never be able sell your house. Pushing this BS bill is necessary to close and sale every home due to no, zero, nada, homes well be closed and sold without this BS SB bill 1435. A bill to enable the sale OF STOLEN HOMES. ABSOLUTE ADMISSION OF THE LENDERS DO NOT KNOW WHO OWNS THE LOANS AND ADMISSION THERE ARE NOT NOTE. NOT EVEN THE SENATORS WILL BE ABLE TO SELL THEIR HOMES EVER.

    Pam Roach and all the panel voted yes on this disasterous bill
    Here is a video of the today’s Executive session passing along SHB 1435. Every member present gives a hearty “I” to pass along.
    Former Bank of America employee Senator Mark Mullet gives the motion to “do pass” SHB 1435 to the Rules committee
    http://www.tvw.org/index.php?option=com_tvwplayer&eventID=2013031129#start=3142&stop=3197

    None of the notes exist on any mortgage and this video (fast forward to bill 1345 on both is admission there are no notes and the lenders do not know who owns the loans.

  3. dee preston says:

    All I am going to say is litigate this and do it right!! No more bad case law people. All of you who do not know what u r doing and litigate and get an unfavorable ruling–knock it off! You are setting precedent and its bad precedent. We need lawyers who are not lazy or stupid. Do your home work and reach out of the box! Xo dee

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