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WV Supreme Court of Appeals Determines State Statutes Don't Require Recording of Assignments ...

West Virginia Supreme Court of Appeals Determines
State Recording Statutes do not Require the Recording of Assignments of Trust Deeds
Lower Court Exceeded Jurisdiction in Denying Motion to Dismiss

FOR IMMEDIATE RELEASE

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

Reston, Virginia, February 10, 2015—MERSCORP Holdings, Inc. today announced that the Supreme Court of Appeals of West Virginia held recording statutes in West Virginia do not require that the assignment of a trust deed be recorded in the office of the clerk of the county commission. 

In pdf State of West Virginia v Warren McGraw (73 KB) , the Court disagreed with Wyoming County’s claims that the recording of trust deed assignments in county record books is required by state law, “in order to clear title to properties in the Counties.” While the Counties did not name MERSCORP Holdings, Inc. or Mortgage Electronic Registrations Systems, Inc. (MERS) as a defendant in the case, the allegations in the complaint were focused on challenging the operations of MERS and the MERS® System.

In his opinion, West Virginia Supreme Court of Appeals Justice Menis E. Ketchum II said that “recording statutes in West Virginia do not require that the assignment of a trust deed be recorded in the office of the clerk of the county commission.”

“We are pleased that the West Virginia Supreme Court found that the lower court – the Circuit Court of Wyoming County – exceeded its jurisdiction in denying the Trustees’ motion to dismiss and is directed to dismiss the County’s action with prejudice,” said MERSCORP Holdings Vice President for Corporate Communications, Janis Smith.

At loan origination, MERS is designated by the lender and the borrower in the trust deed as the beneficiary as the nominee for the lender and the lender’s successors and assigns. The trust deed is recorded in the applicable land records and a recording fee is paid. As long as the sale of the promissory note involves MERS® System Members, MERS remains the beneficiary of the trust deed and the transfer of the note is tracked on the MERS® System.

For descriptions of cases and other materials pertaining to MERS’ business model and role in U.S. housing, please visit www.mersinc.org.

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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. Mortgage Electronic Registration Systems, Inc. (MERS) serves as the mortgagee in the land records for loans registered on the MERS® System, and is a nominee (or agent) for the owner of the promissory note. The MERS® System is a national electronic database that tracks changes in mortgage servicing and beneficial ownership interests in residential mortgage loans on behalf of its members.

MERS Authority as Mortgagee as Nominee Upheld by U.S. District Court in Rhode Island

Court Grants MERS Motion for Summary Judgment

FOR IMMEDIATE RELEASE

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

Reston, Virginia, January 20, 2015—MERSCORP Holdings, Inc. today announced that the United States District Court in Rhode Island granted MERS motion for summary judgment.

In the case, pdf In v. Mortgage Elec. Registration Sys., Inc. (185 KB)  the borrower filed a wrongful foreclosure suit alleging, among other things, that the assignment executed by MERS was void because MERS did not have the mortgage and note.

In his opinion, United States District Judge John J. McConnell, Jr. stated that the law “has not developed in [the plaintiffs’] favor,” ruling that the prior Rhode Island state cases of “Bucci and Moura validated the MERS system and MERS’ role as nominee on behalf of the note owner.” The court reasoned that because MERS had the power to foreclose as mortgagee, once MERS assigned the mortgage, the same power to foreclose was transferred to the assignee of the mortgage.

Additionally, the Court ruled that the prevailing state law in Rhode Island is clear that the note and mortgage do not need to be held by one entity in order to exercise the power of sale.

“We are pleased that the case law continues to develop in favor of MERS in Rhode Island state and federal courts, as well as across the county,” said MERSCORP Holdings Vice President for Corporate Communications, Janis Smith. “MERS has legal authority to act on behalf of the lender and this authority is granted by the plain language in the mortgage document signed at closing by the borrower.”

For descriptions of cases and other materials pertaining to MERS’ business model and role in U.S. housing, please visit www.mersinc.org.

###

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. Mortgage Electronic Registration Systems, Inc. (MERS) serves as the mortgagee in the land records for loans registered on the MERS® System, and is a nominee (or agent) for the owner of the promissory note. The MERS® System is a national electronic database that tracks changes in mortgage servicing and beneficial ownership interests in residential mortgage loans on behalf of its members.

Illinois Circuit Court Rules Mortgages Naming MERS as Mortgagee are Valid and Enforceable

FOR IMMEDIATE RELEASE

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

Reston, Virginia, January 6, 2015—MERSCORP Holdings, Inc. today announced that the Circuit Court of the Nineteenth Judicial Circuit for Lake County, Illinois rejected the borrowers’ claim that their mortgage was void and unenforceable because Mortgage Electronic Registration Systems, Inc. (MERS), the named mortgagee on the mortgage at the time the mortgage was originated, was not licensed under the Illinois Residential Mortgage License Act.

In pdf CitiMortgage, Inc. v. Schak (736 KB) , Judge Mitchell L. Hoffman entered a Memorandum Opinion and Order denying the borrowers’ motion to vacate the summary judgment and Order approving the sale of the property in this foreclosure and holding that the borrowers’ mortgage could not be held unenforceable on grounds that MERS was not licensed under the Act.

Finding the Seventh Circuit Court of Appeals ruling in pdf Union County, Ill. V. MERSCORP, Inc. (162 KB) , 735 F.3d 730 (7th Cir. 2013) instructive, the Court ruled in this case that “… MERS does not engage in the acts of brokering, funding, originating, servicing, or purchasing residential mortgage loans.

Therefore, MERS is not subject to the requirements of the Illinois Residential Mortgage License Act of 1987, and the Mortgage cannot be held unenforceable on this basis.”

“We are pleased that this Court recognizes that MERS has not done anything contrary to what is required by Illinois law and that mortgages naming MERS as the mortgagee are valid and enforceable,” said MERSCORP Holdings Vice President for Corporate Communications, Janis Smith.

For descriptions of cases and other materials pertaining to MERS’ business model and role in U.S. housing, please visit www.mersinc.org.

###

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. Mortgage Electronic Registration Systems, Inc. (MERS) serves as the mortgagee in the land records for loans registered on the MERS® System, and is a nominee (or agent) for the owner of the promissory note. The MERS® System is a national electronic database that tracks changes in mortgage servicing and beneficial ownership interests in residential mortgage loans on behalf of its members.

Tennessee Court of Appeals Rules MERS Qualifies as Interested Party

Trustee has Duty to Name MERS in the Notice of Foreclosure Sale

FOR IMMEDIATE RELEASE

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

Reston, Virginia, January 13, 2015—MERSCORP Holdings, Inc. today announced that the Court of Appeals of Tennessee at Jackson ruled that under applicable Tennessee law, MERS is a “party interested” in the foreclosure of a senior mortgage lien, and that the trustee who conducted a nonjudicial foreclosure of the senior lien was liable to MERS for damages resulting from the breach of her “affirmative duty to identify MERS as an interested party in the notice of foreclosure sale.” In reaching its decision, the Court recognized MERS’ interest in the junior lien as owner of legal title to the security interest and beneficiary of a recorded deed of trust.

In pdf Everbank v. Henson (128 KB) , MERS and Everbank appealed an order of the Chancery Court of Shelby County dismissing its complaint seeking damages and to set aside a foreclosure sale of the Hensons’ property because the trustee did not name MERS on the foreclosure notice. The Appeals Court held that MERS “qualifies as having a recorded interest in a lien that will be extinguished or adversely affected by the sale. Accordingly, … MERS qualifies as an interested party and the statute requires that the foreclosure advertisement and notice provide the names of the interested parties.”

This Court respectfully disagreed with the Court of Appeals of Tennessee at Knoxville panel decision in pdf Mortgage Electronic Registration Systems, Inc. v. Ditto (97 KB) , 2014 WL 24439 (Tenn. Ct. App. Jan. 2, 2014) holding that MERS lacked standing to set aside a tax sale conducted without notice to it. The panel decision in Ditto has been accepted for appeal to the Tennessee Supreme Court, and that appeal is now pending. The Henson court found persuasive Tennessee federal and other state court decisions upholding MERS’ authority to serve as beneficiary and nominee for noteholders and MERS’ right to enforce a security in its own name. The Court therefore held that MERS could seek damages from the foreclosing trustee under Tennessee law based upon the trustee’s failure to identify MERS, the holder of legal title to a junior security lien, in the foreclosure notice.

“We are pleased the Court recognized that the legal title held by MERS is entitled to protection under state law and that the trustee had an affirmative duty to name MERS in the notice of foreclosure because it was an interested party,” said MERSCORP Holdings Vice President for Corporate Communications, Janis Smith.

For descriptions of cases and other materials pertaining to MERS’ business model and role in U.S. housing, please visit www.mersinc.org.

###

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. Mortgage Electronic Registration Systems, Inc. (MERS) serves as the mortgagee in the land records for loans registered on the MERS® System, and is a nominee (or agent) for the owner of the promissory note. The MERS® System is a national electronic database that tracks changes in mortgage servicing and beneficial ownership interests in residential mortgage loans on behalf of its members.

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Click here to proceed.

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