FAQ


 

What is MERSCORP Holdings?

MERSCORP Holdings, Inc. is a privately held corporation that owns and manages the MERS® System and all other MERS® products. It is a member-based organization made up of thousands of lenders, servicers, sub-servicers, investors and government institutions.

What is MERS?

Mortgage Electronic Registration Systems, Inc. (MERS) is a wholly-owned subsidiary of MERSCORP Holdings, and its sole purpose is to serve as mortgagee in the land records for loans registered on the MERS® System and MERS® Commercial.  MERS is a nominee for the lender and subsequent buyers (“beneficial owners”) of a mortgage loan and serves as a common agent for the mortgage industry

What is the MERS® System?

The MERS® System is a national electronic database that tracks changes in mortgage servicing rights and beneficial ownership interests in loans secured by residential real estate. 

Are MERS loans recorded in the public land records?

All MERS mortgages (or deeds of trust) registered on the MERS® System are recorded in the public land records. The MERS® System is not a system of public record nor a replacement for the public land records. No interests in those mortgages (or deeds of trust) are transferred on the MERS® System; they are only tracked. 

How does MERS become a mortgagee or beneficiary?

There are two ways. At closing, the borrower and lender both agree to standard language in the security instrument making MERS the original mortgagee or beneficiary, with the right to act on behalf of the lender and its successors and assigns. The standard language is approved and used by Fannie Mae, Freddie Mac, Ginnie Mae, the Federal Housing Administration (FHA) and the Veterans Administration (VA).  If MERS was not named as the original mortgagee on the security instrument, a lender can record an assignment of the mortgage to MERS after closing.

What does “MERS as original mortgagee” mean to borrowers?

MERS’ role and rights are clearly spelled out in the contract between borrower and lender. When borrowers sign the mortgage security instrument at closing, they agree to standard language that grants and conveys legal title of the mortgage to MERS as mortgagee, giving the company the right to act on behalf of the current and subsequent owners of the loan.

Does MERS collect mortgage payments from borrowers?

No. MERS, MERSCORP Holdings or the MERS® System do not service mortgages. Mortgage lenders, or other mortgage servicing companies, collect payments from borrowers and manage their loans.  Borrowers who have questions about their loans, or who need help with foreclosure prevention, should contact the company they send their payments to—not MERS or MERSCORP Holdings.

What does MERS do for lenders?

As the mortgagee of record, MERS receives service of process, legal notices and other mail regarding the mortgaged properties. MERSCORP Holdings, Inc., on behalf of MERS, sorts, scans and transmits documents electronically to the appropriate member .  Because MERS is a common agent for its members, recording an assignment of the mortgage is eliminated when ownership of the promissory note or servicing rights transfer between members.  This reduces work and cost. The MERS® System also provides information on undisclosed liens, which reduces fraud.  

Does MERS have the documents for loans registered on the MERS® System?

No. MERS, MERSCORP Holdings or the MERS® System are not document custodians and do not hold promissory notes or mortgage documents on behalf of lenders, servicers or investors. We are not responsible for keeping mortgage records—the servicer maintains the loan files. 

How does MERS benefit borrowers? 

MERS as original mortgagee eliminates breaks in the chain of title, resulting in less work and lower fees paid by the lender—fees that would ultimately be passed down to the homeowner. MERSCORP Holdings, Inc. provides access to data in the MERS® System free of charge to homeowners,  county officials, and regulatory officials (subject to privacy restrictions).  Homeowners can access the data on their mortgage loans registered on the MERS® System through MERS® Servicer ID online or by phone at 1-888-679-6377.

Does MERS hide the mortgage note owner?

No. All MERS mortgages (or deeds of trust) registered on the MERS® System are recorded in the public land records. The MERS® System is not a system of public record nor a replacement for the public land records. No interests in those mortgages (or deeds of trust) are transferred on the MERS® System; they are only tracked.