Home Foreclosure News of the Day: The Main Sticking Point Now for Banks Settling on How Much to Pay for Robosigning & Other Illegal Home Foreclosure Tactics
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Ever heard of MERS? If you’re a homeowner facing foreclosure, it’s an organization that probably had a hand in your home loan process.
What Is MERS and Why Homeowners Facing Foreclosure Need to Know
The reason it’s important for homeowners to know about this organization is that it is being taken to task (to court) by many State Attorney Generals because it’s being deemed a “non-owning” party; hence, it doesn’t have the right to issue foreclosure notices on a property.
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As explained in The New York Times article, The Banks Still Want a Waiver, MERS is the acronym for:
. . . the Mortgage Electronic Registry Systems . . . This company, owned by the major banks, was set up in the mid-1990s by the Mortgage Bankers Association, Fannie Mae and Freddie Mac. Its goal was to expedite the home loan process. . . . By eliminating the need to record changes in property ownership in local land records, MERS ramped up profits for lenders. In 2007, MERS calculated that it had saved the industry $1 billion over 10 years. An estimated 60 percent of all home loans were registered to MERS.
MERS has issued foreclosure notices. But, some courts are saying that they don’t have the authority to because they don’t have an ownership interest in the properties; they only, in essence, played an administrative role.
If this sounds like another form of “robosigning”, you’re not far off – and courts around the nation are starting to agree, especially as the practice is continuing, in spite of the fact that many banks stopped foreclosing on homes last fall until they could get their “houses in order” (pun fully intended).
In the June 2011 article, Special Report: Banks still robo-signing (a must-ready for every homeowner facing foreclosure by the way), by Reuters, an investigation by the respected journalistic outlet found:
. . . that loan servicers are still using the corner-cutting tactic that most captured the public imagination last year: robo-signing. . . . The investigation identified six known robo-signers who have continued to churn out large numbers of mortgage assignments since the beginning of 2011 – months after the industry vowed to stop the practice.
So while banks still continue to cut corners, and the legal system seems to be finally taking steps to stop some of this madness, the most obvious question is . . . .
What options does this leave for “the Average Joe homeowner?”
Quite simply, hold on and sit tight until the courts figure it out. It probably won’t change your situation that much (after all, if you can’t pay your mortgage and you can’t get a mod from your lender, you’re probably going to lose your home) . . . but, until all the legal wrangling is done, it migh give you time to get your finances together to figure out your next move, ie:
Continue to try to work out a deal with your lender to stay in your home (get a home loan modification);
Go through (Chapter 7) bankruptcy to try to stave off foreclosure;
Voluntarily walk away from your home;
Do a deed in lieu of foreclosure; and/or
A short sale.
Related Posts
Home Foreclosure News: 9 Million Homeowners Could Go Into Foreclosure Between 2009 & 2012
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Some Banks are Purposely NOT Foreclosing on Homeowners in Default: Here’s Why
Foreclosure Statistics: 4 Reasons Home Foreclosures are Suddenly Declining
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