MERS. Who Will Kill The Beast?

By
Real Estate Broker/Owner with Tutas Towne Realty, Inc and Garden Views Realty, LLC BK607690

MERS is coming to take me away!!Hi folks. While cruising around Face Book this morning I found a link posted by Matt Heaton that really helps to explain the beast that is MERS (Mortgage Electronic Registration Systems).

The key points.....in a nut shell are:

  • * Tax Avoidance. In the mid 1990s Mortgage Bankers set up MERS to avoid paying State and County transfer taxes. All the assignment of mortgages would take place within this shell company so technicallly the owner of record would not change.
  • * "Employees" who really aren't. MERS "owns" 60% of the Nation's mortgages yet has no real employees!! They allow employees of mortgage services, originators, debt collectors and foreclosure law firms to register as officers of MERS so they can use the corporate name to foreclose on properties!
  • *  Splitting the note and the mortgage. This action would basically make it impossible to foreclose on the note since the mortgage is the instrument used to secure the collateral. Splitting the two makes the note unsecured.

Take a few minutes and read the full article. The MERS Edifice Quavers (The Market Ticker)

Man oh man!!! The shit is truly getting ready to hit the fan. I really don't know what else to say. Do you?

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***I am NOT an Attorney nor do I play one on TV. Click the button below for my Bio.

The BIO for Bryant Tutas

 

 Tutas Towne Realty, Inc handles Florida real estate sales, Florida short sales, Florida strategic short sales, Florida pre-foreclosure sales, Florida foreclosures in Kissimmee Florida Short Sales, Davenport Florida Short Sales, Haines City Florida Short Sales, Poinciana Florida Short Sales, Solivita Florida Short Sales,  Orlando Florida Short Sales, Celebration Florida Short Sales, Windermere Florida Short Sales. Serving all of Polk, Osceola and Orange Counties Florida. Florida Short Sale Broker. Short Sale Florida.

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Re-Blogged 10 times:

Re-Blogged By Re-Blogged At
  1. Jim Hale 10/12/2010 08:17 AM
  2. Kim McMahon 10/12/2010 10:04 AM
  3. Judy Chapman 10/12/2010 11:45 AM
  4. Marcie Purcell 10/13/2010 02:46 PM
  5. Katerina Gasset 10/13/2010 05:56 PM
  6. Steve Davis 10/13/2010 07:52 PM
  7. Michelle Carr Crowe,Altas Just Call...408-252-8900! 10/13/2010 09:44 PM
  8. Mark Brian 10/14/2010 02:04 AM
  9. Susan Haughton 10/14/2010 02:59 AM
  10. Marzena Melby 10/14/2010 03:34 AM
Location:
Florida Polk County Poinciana Solivita
Groups:
Realtors®
Real Estate Rookie
Tags:
foreclosure
mers

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Rainer
74,745
John J. Woods
Big Dog Press, LLC - Winder, GA
Going where no man has gone before - wouldn't you?

Bryant,

I couldn't agree more with your post and the article referenced.  I see MERS as a problem for the banks much larger than the enclosed issue of 'robo-signers' and, frankly, I'm surprised that more of the banks didn't immediately follow B of A's lead on 'declaring a moratorium' on foreclosures.  Any bank using MERS &/or 'robo-signers' is just being stupid to continue the same old course of action under the knowledge of these recent exposures without a complete reevaluation.

The legal issues will put REI sales, if not the entire mortgage industry, on hold for an indefinite amount of time which is going to have an addtiional negative effect on the entire economy, in my mind.  And now that the issues are all(are they?) on the table, what responsible title company is going to issue title insurance on ANY suspect property?  These are HUGE implications.

The article doesn't seem to come out and point the "fraud" finger at the banks per se, but instead, dances around the issue a bit.  But "avoidance" in place of "fraud" is not exactly 'calling a spade a spade'...


"Remember -- Think twice, push "Send" once.  Blogging, posting, commenting:  It's all 'never having to say you're sorry', because it won't make any difference --

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Oct 13, 2010 09:30 PM #35
Ambassador
2,034,818
Michelle Carr Crowe,Altas Just Call...408-252-8900!
Get Results Team...Just Call (408) 252-8900! . DRE #00901962 . Licensed to Sell since 1985 . Altas Realty - San Jose, CA
Family Helping Families Buy & Sell Homes 40+ Years

This is scary stuff--oh and people thought the crooks were gone now? No, they just moved on.

Oct 13, 2010 09:43 PM #36
Ambassador
1,726,157
Richard Weisser
Richard Weisser Realty - Newnan, GA
Richard Weisser Retired Real Estate Professional

BB...

I never knew this ...  only saw MERS when doing title research and I always wondered what the deal was.

Oct 14, 2010 12:44 AM #37
Rainer
75,537
Steve McCoole
Mortgage Alliance Group - San Diego, CA - NMLS#305667 - San Diego, CA

It is interesting how the mainstream media is doing very little reporting of this, instead saying the current FC moratorium is due primarily to "paperwork problems."  Of coursre that is the line that the banks are feeding them.

This goes way deeper than paperwork issues with legal flaws in the way lenders have been doing their legal business.  Besides MERS, there are also potential legal flaws with PSAs and MBS tranches that can and will be challenged in courts all over the country.

A mess of epic proportions for sure.  Who knows where resolution will come from but it will certainly have to be addressed at the highest levels of our judicial and legislative bodies.

Oct 14, 2010 01:59 AM #38
Rainer
20,366
Nick Tukmanian
RealWorks Residential - Colts Neck, NJ

Nice post and thanks for the link. I love a good Law analysis ;)

Oct 14, 2010 02:27 AM #39
Rainer
105,870
Brian Bean
The Dream Big Team at Better Homes and Gardens Real Estate Champions - Riverside, CA
Homeowner Advocate, Dream Big Team, S.Calif

It will be interesting to see how they unravel the chain of title on the 3.75 million homes in shadow inventory. With so many loans package and sold and repackaged and resold, investors could be fighting for decades over who really owns the mortgages.

Oct 14, 2010 02:37 AM #40
Rainmaker
162,875
Rhonda Burgess
Southern Living Realty Partners - Smyrna, TN
Moving to Nashville TN Real Estate Specialist

The only word I can come up with is WOW! I knew it was bad but this is horrible.  As I have posted before, this mess will not be over in a few weeks like the banks are trying to spin it.  

Oct 14, 2010 03:06 AM #41
Rainmaker
101,673
Trent Cluley
Jasper, GA

I have been watching the MERS issue unfold for some time and am surprised it hasn't grabbed more headlines, as in my opinion it could be every bit as explosive as the current foreclosure debacle, and probably more so. The courts seem very divided in their rulings, with decisions going in both directions in different states, and wouldn't be surprised to see this ending up before SCOTUS if there proves to be a split in district court rulings . . . not to mention the significant issues at stake here that would make it worthy of their attention.  Thanks for sharing the link!

Oct 14, 2010 04:13 AM #42
Rainmaker
139,564
Vicki Lloyd
The Lloyd Realty Group - San Diego, CA
(619)452-9798, Real Estate San Diego California

This is an unbelievable mess!  Hard to imagine that it could be so convoluted.  Thanks for bringing it out.

Oct 14, 2010 04:46 AM #43
Rainmaker
130,007
Jim Little
Ken Meade Realty - Sun City, AZ
Your Sun City Arizona Realtor

Fascinating link: more info on MERS needs to get out to all of us. I am unsure how this effects AZ, as a trust deed non-judicial foreclosure state, can't wait to find out.

Oct 14, 2010 04:51 AM #44
Rainmaker
1,560,731
Carla Muss-Jacobs, RETIRED
RETIRED / State License is Inactive - Portland, OR

Great piece, BB.  It inspired me to do this:  MERS, MISMO, MBA . . . Gorillas in the Mist  (hope it's okay to link)

Oct 14, 2010 09:03 AM #45
Rainmaker
1,534,046
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg IL Real Estate

BB, thanks for including that link to the Market Ticker. Did anyone in the legal profession forsee this basic problem? Did anyone graduate law school? This whole grouping of bone heads didn't see or talk this over with any legal counsel?

Leslie or BB or TLW: Start a group - Understanding Mers or Mers debacle.

Oct 14, 2010 11:27 AM #46
Rainmaker
2,498,167
Rebecca Gaujot, Realtor®
Vision Quest Realty - Lewisburg, WV
Lewisburg WV, the go to agent for all real estate

Bryant, truly unbelievable...but so is the photo of the baby the gorilla is holding...what does TLW have to say about that :)

Oct 15, 2010 03:55 AM #47
Ambassador
557,018
"The Lovely Wife" (Broker Bryantnulls Wife) The One And Only TLW.
President-Tutas Towne Realty, Inc. - Kissimmee, FL

Wow...

I keep seeing featured posts with less than 50 comments on them. There's something seriously wrong with this picture.

TLW...ROAR!

Oct 15, 2010 08:25 AM #48
Rainmaker
1,142,060
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

Hey guys. Want to read another really good article? Check out this one

http://gonzalolira.blogspot.com/2010/10/second-leg-down-of-americas-death.html?spref=fb

It was sent to me by another member. The language is a little rough but it's a great article.

Oct 15, 2010 11:35 AM #49
Rainmaker
153,346
Amanda Evans
DFW Living - Fort Worth, TX
Real Estate Broker - Fort Worth Texas

#50.  I agree about the lack of attention on this very worthy feature...I wrote a little ditty about defending commissions (total overkill) and it got way too much attention-sign of the times if you ask me.  THIS IS IMPORTANT game changing stuff and needs to be read.  The bottom line is that we could be headed to a fan so covered in crap, that there won't be anything left to defend.

Oct 16, 2010 05:10 AM #50
Rainmaker
153,346
Amanda Evans
DFW Living - Fort Worth, TX
Real Estate Broker - Fort Worth Texas
Oct 16, 2010 06:27 AM #51
Rainmaker
1,079,379
Sharon Alters
Coldwell Banker Vanguard Realty - 904-673-2308 - Fleming Island, FL
Realtor - Homes for Sale Fleming Island FL

BB, I read about the MERS issues last week. Always wondered who the heck MERS was. I never saw it mentioned anywhere as a bank or anything but it was on so many loans! Now the truth comes out...

Oct 17, 2010 05:19 PM #52
Rainer
130,161
Kirsten Mellinger
Emerald Funding & Realty - Simi Valley, CA
Ventura County Real Estate

YIKES!!!  I am truly speechless and can't even start to imagine where we're headed!

Oct 19, 2010 03:11 AM #53
Rainmaker
1,560,731
Carla Muss-Jacobs, RETIRED
RETIRED / State License is Inactive - Portland, OR

This is a prophetic post!!  You should write about how smart you are!!  ;-)  Just read Richard's feature, and you hit the nail on the head with this post!!  AWESOME!!

Feb 16, 2011 06:48 AM #54
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