HEY - WHO'S HIDING THE SALAMI?

Mers was orginally set up by the lending industry to manage documents like mortgages and liens that would normally be filed publicly by the lending institution with the County Recorder’s Office. Instead of the lender doing the filing with the County Recorder MER’S creates a onetime filing with the Recorder’s Office. After MER’S does the onetime recording the MERS’ system does an internal monitoring when a deed is transferred from one party to another and the name MRES shows up on the Note and Deed recording instead of the real owner of the security.

Over half of all new home loan securities in North America are registered with MERS and recorded in county recording offices in MERS’ name. What MER’S has created is a lack of transparency in the mortgage market in two ways.

First, consumers and their counsel can no longer turn to the County Recorder’s Office to find out who is holding on to note and deed. Now when you begin to research a property to find chain of title, etc, often what you see registered as holder of the note is MERS, and the real owner of the note is conveniently veiled through use of the MERS instrument.

Right now MERS is foreclosing on properties all over the United States by using its name as owner of record even though it is really not the actual lien holder. In reality MER’S is still just a document management company acting like an owner.

MERS may get the real owner’s permission to act on its behalf or MERS is acting as an agent of the owner but the process creates some real problems.

MERS has not set up a system nor does it care to set up a system to respond to consumers or legal professionals when requests are made for discovery of evidence in regards to things like predatory lending claims and RESPA violations.

What MERS is set up to do is act as a shill for whoever owns the note and deed and foreclose on a home as quickly as possible without giving up any information. They are like a Phantom that cannot be contacted. This posture allows them to block the consumer and their agents from finding out about acts of predatory origination and RESPA violations.

While up against the wall of foreclosure, consumers that try to assert predatory lending defenses are often forced to join the party – usually an investment trust – that actually will benefit from the foreclosure. As a simple matter of logistics this can be difficult, since the investment trust is even more faceless and seemingly innocent than MERS itself. The investment trust has no customer service personnel and has probably not even retained counsel. Inquiries to the trustee – if it can be identified – are typically referred to the servicer, who will then direct counsel back to MERS. This pattern of non-response gives the securitization conduit significant leverage in forcing consumers out of their homes. The prospect of waging a protracted discovery battle with all of these well funded parties in hopes of uncovering evidence of predatory lending can be too daunting even for those victims who know such evidence exists. So imposing is this opaque corporate wall, that in a “vast” number of foreclosures, MERS actually succeeds in foreclosing without producing the original note – the legal sine qua non of foreclosure – much less documentation that could support predatory lending defenses. (Timothymccandless’s Weblog)