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MERS
Mortgage Electronics Registration Systems, Inc., (MERS) is being investigated due to its practice of overcharging borrowers for fees in connection with foreclosures.
MERS allegedly retains attorneys to handle foreclosure actions at a stated price but when the attorneys’ fees are passed along to the borrowers, MERS charges the borrowers more than it pays the foreclosure attorneys, keeping the profit to itself.
MERS, based in Vienna, Virginia, was created by the mortgage banking industry with the mandate of electronically recording every mortgage loan in the United States. Lenders are able to track and trade loans using the company's system. According to its website, MERS acts as nominee in the county land records for the lender and servicer. Any loan registered by MERS is inoculated against future assignments because MERS remains the nominal mortgagee no matter how many times servicing is traded.
Accordint to MERS, fifty million loans have been registered over the last ten years and every loan is recorded in the county land records. “Registering a loan on MERS lowers the cost of buying a home by squeezing unnecessary fees out of the process and eliminating fraud by identifying the true mortgage company attached to that property,” MERS claims.
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