Foreclosures are one thing. I wonder what will happen when people realize that “paying off the note” under the MERS system is also invalid. The whole residential real estate market could freeze up.
Then again most people don’t pay attention so maybe not.
MERS was, of course, created by banks for the purpose of juggling mortgages or pieces of mortgages. If MERS had actually bothered to put through timely and proper local paperwork as a follow up to every transaction, I think they would be worthy of much less derision. But local property ownership recording systems aren’t going to take kindly to someone claiming to have invented an alternative system that their records know nothing of. Anyhow, if MERS is locally recorded as owning a piece of real estate, then logically it is theirs, not any bank’s.
The Dominoes are about to fall. Will it be a thud or a scream of rage?
“But he said “MERS did not have authority, as ‘nominee’ or agent, to assign the mortgage absent a showing that it was given specific written directions by its principal. This court finds that MERS’s theory that it can act as a ‘common agent’ for undisclosed principals is not support(ed) by the law.”
“He said that in future cases involving MERS, parties seeking in bankruptcy proceedings to avoid the ban on legal claims must show they own both the note and the mortgage.”
Whether or not one party can act as agent for another party, and to what extent that party can act is spelled out in the contracts between the parties and is usually found binding UNLESS THE LAW SAYS IN SOME SPECIFIC CIRCUMSTANCE IT IS NOT and is usually NOT prohibited just because one party gives another party wide latitude to act as their agent without incident by incident instructions.
I think the judge might be acting, wrongly, on how poorly MERS has done things, as opposed to the true legality of whether or not it had authority for its actions according to its contracts with banks and mortgage lenders.
This is not to be taken seriously. Bankruptcy judges are like a justice of the peace. They are horribly inferior and their decisions are meaningless. Mortgages are sold and transferred everyday and will be tomorrow. Let us seek out real news.
So... Does this cover CitiMortgage and Nationstar? If so, what’s that mean for me? I am not in foreclosure, or even late. My mortgage just got sold a couple months ago.
At some point, title insurance companies stop insuring titles because the risk of loss is too great. Either we have clear titles or we don’t...
What a mess. The longer it gets fixed, if even possible, the harder the crash. Something needs to be done so the mortgages in default go through some kind of process. My heart lies with those who have paid their debts.
“This court finds that MERS’s theory that it can act as a ‘common agent’ for undisclosed principals is not support(ed) by the law.” He said that in future cases involving MERS, parties seeking in bankruptcy proceedings to avoid the ban on legal claims must show they own both the note and the mortgage.”
The big banks have to follow the same laws the rest of us peons do? What’s the world coming to?