• The Hallmark Abstract Sentinel
MERS (Mortgage Electronic Registration System) and the avoidance of mortgage recording fees
Currently MERS is dealing with a storm in the foreclosure arena over whether or not a lender was legally able to foreclose on a mortgage in MERS name. This has led the firm to issue an announcement instructing all of its members to cease this practice immediately ("Is MERS attempting to put the genie back into the bottle with yesterdays announcement")
Remember that MERS was established for the purpose of creating an electronic system that was able to easily assign mortgages from one entity to another. This became critical in the age of securitizations when this paper would change hands quickly and often.
As part of this business model, members were able also to bypass the recording of mortgages in county clerks offices with a resulting savings of money by avoiding recording fees.
Suits by counties to recoup these recording fees may be the next landmine that MERS will face...
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