One word. BIFURCATION.

In order to break MERS, one must get the Trust(s) Agreements with MERS, MERSCORP.

Lexology-

An interesting challenge is being played out in the federal court in Pennsylvania regarding the way most mortgage assignments are now handled within the land record system. Plaintiff, the Montgomery County Recorder of Deeds, commenced the litigation on behalf of herself and a proposed class of similarly situated Recorders of Deeds Offices in Pennsylvania against MERSCORP, Inc. and Mortgage Electronic Registration Systems (MERS). The Recorder claims that defendants have created a private system for tracking conveyances of interests in land which ignores the statutorily created recording system established by Pennsylvania law.

In a traditional transaction, a lender retains a promissory note in its own loan portfolio and may later transfer the note with a corresponding assignment of the mortgage which secures the debt. When the assignment is made, it must be recorded, for a fee, with the Recorder for the county in which the property is located. However, in recent years, many promissory notes have been subject to a complex process called “securitization”. When a note is securitized, it is transferred along with other notes into a trust which then issues securities backed by the trust to investors.

[LEXOLOGY]