Tag Archives: MERS

Massachusetts Supreme Court Rules against Wells Fargo in Foreclosure Case

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If you have been following the MERS involvement in the foreclosure crisis you are well aware of MERS and the robo-signer stories.  Courts have been ruling against MERS and the banks.  They have dismal record keeping procedures and the courts have ruled in favor of the homeowners.

The situation may have just come to a head in a case involving U.S. Bancorp and another involving Wells Fargo.  Neither of these cases involved MERS.  The Massachusetts Supreme Court, in a unanimous decision, ruled that neither Wells Fargo nor U.S. Bancorp have standing and consequently have no right to foreclose because they failed to show that they were holders of the mortgages at the time of foreclosure.

Justice Robert Cordy, in a concurring opinion, blasted the “utter carelessness” the banks demonstrated in documenting their right to own the properties.

This ruling is expected to slow down the foreclosures significantly and consequently significantly affect the entire home loan process and market place.

Massachusetts, like Nevada is a non-judicial foreclosure state.  If the banks were playing fast and loose in Massachusetts, what is the likelihood that they would have operated differently here in Nevada?

Do we face the prospect of having foreclosures overturned here too?



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MERS loses again in California Bankruptcy Case

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A ruling issued by the United States Bankruptcy Court for the Eastern District of California found that, as a matter of law, MERS could not have transferred the note to Citibank from the original lender, Bayrock Mortgage Corp.  The Court’s opinion states that MERS and Citibank are not the real parties in interest.

The court found that MERS acted “only as a nominee” for Bayrock under the Deed of Trust and there was no evidence that the note was transferred.  The opinion also noted that “several courts have found that MERS is not the owner of the underlying note and therefore could not transfer the note, the beneficial interest in the deed of trust, or foreclose on the property secured by the deed”.

The opinion states: “Since no evidence of MERS’ ownership of the underlying note has been offered, and other courts have concluded that MERS does not own the underlying notes, this court is convinced that MERS had no interest it could transfer to Citibank. Since MERS did not own the underlying note, it could not transfer the beneficial interest of the Deed of Trust to another.  Any attempt to transfer the beneficial interest of a trust deed without ownership of the underlying note is void under California law.”

The bottom line is that MERS cannot assign what it does NOT own.

For more see here.

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Lawsuit Could cost Mers Billions

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A Reno law firm recently filed suits against MERS, (Mortgage Electronic Registration Systems) in both Nevada and California.  The suits allege that MERS and dozens of lenders associated with MERS have defrauded the government of recording and filing fees.   Courts have repeatedly ruled against MERS , finding that it has no standing in the foreclosure proceedings because they have no particular interest in the outcome of any particular case.  (MERS does not benefit if the loan gets paid off.)  Consequently, they are involved, merely to facilitate the lenders in avoiding recording and filing fees.

MERS was originally created to assist the lenders with their record keeping but has evolved as the main entity pursuing foreclosures.  the majority of trust deeds show MERS as one of the beneficiaries of the mortgage.

This has previously been discussed here, here and here.

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