In a Senate Banking Committee hearing, newly elected Massachusetts Senator Elizabeth Warren asked why bank regulators protected banks, but would not assist wronged homeowners. Regulators did not have an answer to her question, but there is still another question that needs to be asked: What about the economic damages to county governments from banks using a false mortgage registration system – MERS – to avoid paying mortgage registration fees
What is MERS?
”Mortgage Electronic Registration Systems” (MERS) is a privately held company that operates an electronic registry designed to track servicing rights and ownership of mortgage loans in the United States.
MERS serves as the mortgagee of record for lenders, investors and their loan servicers in the county land records. MERS claims its process eliminates the need to file assignments in the county land records which lowers costs for lenders and consumers by reducing county recording revenues from real estate transfers and provides a central source of information and tracking for mortgage loans.
The Washington Post explains how MERS supplanted the centuries-old property registration systems at the county level and allowed banks to use mortgages like securities:
MERS allowed big financial firms to trade mortgages at lightning speed while largely bypassing local property laws throughout the country that required new forms and filing fees each time a loan changed hands, lawyers say.