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The assertions about MERS are without merit. We will cooperate with the investigation and look forward to the opportunity to respond to the Massachusetts Attorney General's request. The use of MERS has been litigated in Massachusetts courts, and judges have upheld the legality of the MERS business model in the Commonwealth. Some of the latest rulings are as follows:

For a list of Massachusetts judicial rulings to date concerning MERS, including decisions in Massachusetts, please consult our Case Law Outline.

FOR REPORTERS: Please attribute the statement above to This email address is being protected from spambots. You need JavaScript enabled to view it., MERSCORP Vice President of Corporate Communications, 703-783-0230.

Court notes that terms of Deed of Trust are written in “plain language” and borrowers agree to them

FOR IMMEDIATE RELEASE

CONTACTS:
Janis L. Smith
Phone: 703-738-0230
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Karmela Lejarde
Phone: 703-761-1274
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Reston, Va., July 18, 2011— The Utah Court of Appeals last week in pdf Commonwealth Property Advocates, LLC v. Mortgage Electronic Registration Systems, Inc. and CitiMortgage, Inc., et al (144 KB) , affirmed the trial court’s dismissal of the lawsuit. In a July 14th opinion, Presiding Judge James Z. Davis wrote that “The plain language of the statute does nothing to prevent MERS from acting as nominee for Lender and Lender’s successors and assigns when it is permitted by the Deed of Trust.”

Commonwealth Property Advocates asserted that the deed of trust was separated from the note shortly after being executed because although Citi continued to service the mortgage, they sold the debt represented by the mortgage note – which was later securitized – and therefore the debt became unsecured. The Appeals Court rejected the plaintiff’s argument that the securitization of the borrowers’ mortgage nullified MERS’ rights as expressly set forth in the deed of trust. “Here, we believe the plain meaning of the statute is clear. The statute simply states, the transfer of any debt secured by a trust deed shall operate as a transfer of the security...” Utah Code Ann. § 57‐1‐35 (2010). “[W]e do not interpret the statute as preventing, implying or somehow indicating that the original parties to the Note and Deed of Trust cannot validly contract at the outset to have someone other than the beneficial owner of the debt act on behalf of that owner to enforce rights granted in [the security instrument]…”

The Appeals Court also noted that the borrowers agreed to the terms of the deed of trust, which allows MERS, as “nominee for the lender and the lender’s successors and assigns,” to exercise any or all of the lender’s interests, including, but not limited to, foreclosing or assigning the deed of trust. Judge Davis stated, “…the plain language of the Deed of Trust gave MERS the right to foreclose on behalf of [the] Lender and Lender’s successors and assigns.”

“The Utah Appeals Court’s decision in Commonwealth is clear that the sale or securitization of a promissory note doesn’t change MERS’ legal right to enforce the terms of the deed of trust,” said Janis Smith, MERSCORP’s Vice President of Corporate Communications. “It’s also a significant acknowledgement that the terms of the deed of trust are written in plain language and borrowers agree to them when they close on a mortgage loan.”

Ballard Spahr partner Anthony C. Kaye, who represented MERS in the case, said, “The Court of Appeals’ ruling means that homeowners can’t avoid their mortgages because the loans have been transferred or because the underlying notes have been securitized. This decision mirrors numerous rulings we’ve obtained in state and federal trial courts, but is especially significant as it effectively settles these issues as they relate to homeowners in Utah.”

In interpreting an identical trust deed provision, the United States District Court for the District of Utah has held numerous times that even in the face of securitization, the provisions of the deed of trust continue to grant MERS “the authority to initiate foreclosure proceedings, appoint a trustee, and to foreclose and sell the property.” See Commonwealth Prop. Advocates, LLC v. Mortgage Elec. Registration Sys., Inc., (D. Utah Sept. 20, 2010); Commonwealth Prop. Advocates, LLC v. First Horizon Home Loan Corp (D. Utah Nov. 16, 2010); and Burnett v. Mortgage Elec. Registration Sys., Inc., (D. Utah Oct. 27, 2009) .

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FOR IMMEDIATE RELEASE

CONTACTS:
Janis L. Smith
Phone: 703-738-0230
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

Karmela Lejarde
Phone: 703-761-1274
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

Reston, Va., July 15, 2011— Another ruling from the U.S. District Court in the Eastern District of Michigan Southern Division declined to reconsider a non-judicial foreclosure initiated by Mortgage Electronic Registration Systems, Inc. (MERS), as mortgagee, underscoring former borrowers’ lack of standing under Michigan law to challenge a foreclosure after the statutory redemption period has expired, further limiting the applicability of the Michigan Court of Appeals’ decision in pdf Residential Funding v. Saurman/Bank of New York Trust v. Messner (“Saurman”) (62 KB) .

On July 12, Judge Marianne O. Battani denied the plaintiff’s motion to reconsider the May 2011 judgment entered in favor of MERS and other defendants in pdf March v. Countrywide Home Loans Servicing (103 KB)  (“March”), writing in the opinion that “under Michigan law, once the redemption period following foreclosure of property has expired, the former owner’s rights in and title to the property are extinguished. Consequently, Plaintiffs lack standing to challenge their foreclosure,” citing to Piotrowski v. State Land Office Bd., 4 N.W.3d 514 (1942) and Overton v. Mortgage Electronic Registration Sys, No. 284950, 2009 WL 1507342 (Mich Ct App, May 28, 2009).

The plaintiffs’ motion argued that the May 2011 judgment denying their wrongful foreclosure claims should be reversed based on the Michigan Appellate Court’s April 2011 decision in Saurman, but the court disagreed with their argument. In the March opinion, Judge Battani stated, “[a]t most, Plaintiffs have presented case law from the state appellate court that supports a claim they never made in their complaint or proposed amended complaint. This showing does not trump the important policy interest in the finality of judgments.” The March ruling follows Judge Battani’s June 10th ruling in pdf Knox v. Trott (128 KB) , in which she also found that the Saurman decision did not apply (in that case because MERS could assign its security interest before foreclosure, which it did).

Separately, in another decision from the U.S. District Court in the Eastern District of Michigan Southern Division, on June 9th, Judge John Corbett O’Meara ruled in favor of the lender in pdf Williams v US Bank Nat’l Ass’n (15 KB)  (“Williams”). In Williams, the plaintiffs also argued for the applicability of Saurman, but Judge O’Meara concluded that “Saurman does not apply here. In this case, U.S. Bank, not MERS, initiated the foreclosure by advertisement. To the extent Plaintiffs challenge any assignment from MERS to U.S. Bank, Plaintiffs lack standing to do so because they were not a party to those assignments.” See Livonia Props. Holdings, LLC v 12840-12976 Farmington Rd. Holdings, LLC, 399 F. Appx. 97, 102-03 (6th Cir. 2010).

Judge O’Meara in this case also noted that the Williamses lacked standing to challenge the foreclosure after the statutory redemption period, and stated, “In this case, the redemption period expired on September 2, 2010; therefore, Plaintiffs lack standing to challenge the foreclosure absent a showing of fraud or irregularity, neither of which Plaintiffs have shown.”

“The federal court’s rulings in the March and Williams cases reinforce that legally completed foreclosures are final once the redemption period has expired,” said Janis Smith, MERSCORP Vice President of Corporate Communications. “It’s also a clear signal that courts won’t automatically overturn completed foreclosure cases.”

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Judge validates company’s role to act as beneficiary and nominee for lender

FOR IMMEDIATE RELEASE

CONTACTS:
Janis L. Smith
Phone: 703-738-0230
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

Karmela Lejarde
Phone: 703-761-1274
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

Reston, Virginia, July 13, 2011—The Nineteenth Judicial Circuit Court of Virginia ruled in favor of Mortgage Electronic Registration Systems, Inc. (MERS), finding that MERS has the right to enforce the deed of trust.

In his June 29th decision in pdf Graves v. MERS (565 KB) , Judge Jonathan C. Thacher stated that when the plaintiff signed the deed of trust, she agreed that MERS has the right to take any action required of a lender. Judge Thacher noted that “the plain language in the Deed of Trust authorizes MERS to foreclose on the Property in the event that Graves defaulted on the loan.”

“MERS has two roles: beneficiary and nominee for lender,” wrote Judge Thacher. “By signing the Deed of Trust, Graves agreed that MERS, as nominee for lender and lender’s successors and assigns, has the right to foreclose…and recognizes that MERS could take any action required of [the] lender.” Judge Thacher also said that deeds of trust are “treated as contracts,” and “nothing under Virginia law appears to prohibit a lender and borrower from agreeing to allow a third party…to enforce the terms of a deed of trust.”

“This decision is noteworthy for its recognition of MERS’ dual role as beneficiary under the deed of trust and as nominee for lenders in Virginia, with the right to exercise any or all of the lender’s interests,” said Janis Smith, MERSCORP’s Vice President of Corporate Communications. “It also affirms that MERS’ business model is valid in Virginia.”

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  • About Us

    About Us

    Today’s financial services industry depends on technological innovations to provide its customers with access to information, increased efficiency and reduced processing costs. MERSCORP Holdings, Inc. owns and operates the MERS® System, a national electronic registry system that tracks the changes in servicing rights and beneficial ownership interests in mortgage loans that are registered on the System.

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  • MERS® eRegistry

    MERS® eRegistry

    The MERS® eRegistry is essential to the eMortgage world. It is the legal system of record for identifying the Controller (holder) and Location (custodian) for the authoritative copy of a registered eNote. Lenders today are closing eNotes and selling them into the secondary market. Both Freddie Mac and Fannie Mae require that Lenders register their eNotes on the MERS® eRegistry.

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  • Information for Homeowners

    Information for Homeowners

    Homeowners today want information about their mortgage loans. Some are facing financial hardship and are struggling with mortgage payments. Information and helpful resources are available. 

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  • Neighborhood Benefits

    Neighborhood Benefits

    Title agents, government agencies and others looking for information about mortgage loans registered on the MERS® System can use Servicer ID or MERS® Link. This public access is often used by local municipalities to identify the servicer responsible for maintaining vacant or abandoned property.

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  • Media Room

    Media Room

    The MERSCORP Holdings, Inc. Media Room provides press contact information and facts about the company and its subsidiary, Mortgage Electronic Registration Systems, Inc. (MERS). These materials are provided to help national, regional and local media better understand the companies' business model and role in the U.S. housing finance system.

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