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Over 62 million mortgages are now held in the name of MERS, an electronic recording system devised by and for the convenience of the mortgage industry. A California bankruptcy court, following landmark cases in other jurisdictions, recently held that this electronic shortcut makes it impossible for banks to establish their ownership of property titles — and therefore to foreclose on mortgaged properties. The logical result could be 62 million homes that are foreclosure-proof.
In the period beginning in 1999 and ending in March of 2008, Mortgage Electronic Registration Systems Inc., aka MERS, has been named as a "mortgagee" on over 50 million mortgages. Yet MERS has never originated a single mortgage loan nor loaned a dime to a single borrower.
In 2001 the New York Supreme Court ordered the Suffolk County Clerk to accept MERS mortgages for recording as a purely ministerial duty. However the Court denied MERS request for a judgment declaring that MERS mortgages were "lawful in all respects".
The New York Court of Appeals affirmed the Supreme Court's order directing the County Clerk to record MERS mortgages. The Court of Appeals did not reverse the Supreme Court's denial of MERS request for a judicial declaration that MERS mortgages are "lawful in all respects".
New York-based attorney Susan Chana Lask has filed a federal class action complaint on behalf of tens of thousands of New York State homeowners who lost their homes to an alleged foreclosure fraud orchestrated for years by a New York “foreclosure mill” attorney and major mortgage companies. The case is filed in the US District Court, Eastern District of New York, entitled “Connie Campbell against Steven Baum, MERSCORP Inc., et al.”, Case #10CV3800. It alleges violations of the Racketeer Influenced and Corrupt Organizations Act (RICO), Real Estate Settlement Procedures Act (RESPA) and the Fair Debt Collection Practices Act, and that homeowners paid inflated foreclosure and other fees fictionalized by Baum who profited from the scheme since 2005.
When will we see Attorney General Holder open a criminal investigation into this matter? Is there not sufficient question as to whether or not the very existence of these so-called "transfer systems" evidences an enterprise between multiple parties formed for the very purpose of circumventing state law, and that such systems, inherently being formed and operated in interstate commerce, are certainly within the realm of Federal Government jurisdiction.
There are many who will argue that this is "just" a civil matter. I disagree. The intentional creation of these devices as an enabler to alleged value where none exists is not a civil matter. Nor is creating securities where one represents that a particular interest exists for the purchaser, when in fact it does not.
Wake up America - and if the United States AG will not act, then the State Attorneys General must.
In the meantime if you are facing a foreclosure and MERS was involved in some fashion, either in assignment
So when the time comes to foreclose on the loans the actual lender is difficult if not impossible to ascertain. So, you many ask...how does this benefit me? One of the things you can do when facing foreclosure is to demand that the bank show you the original note, in other words proof that they own your home. They have to prove that they OWN the note (your home). A bank cannot take your home if they have no proof of ownership. This tactic has worked with people who have been sued by credit card companies. The debt from a credit card company has been bought and sold so many times that in many cases the collection agency has no legal proof that they own the debt or that you owe the debt. Without that proof they are NOT entitled to collect it from you.
I have received a number of reports that “outsource providers” are servicing the foreclosers by creating color copies of documents and submitting them as originals. One report is that the “original” was examined at the courthouse and found to be a printout from a very good color printer. It’s a neat trick and one that has probably worked many hundreds if not thousands of times.
This is in addition to the simple ABC’s of chain of title where these service providers create documents signed in one place, witnessed in another place and notarized in another place purporting to transfer a note, mortgage or obligation. You can usually tell that these were not created on the dates they purportedly show they were executed, if nothing else than by noticing dates or breaks in the chain of title. If Joe Smith owns the note and Mike Jones signs an assignment to Mary Simpson, there is a break in the chain of title. Get it?