Arkansas Supreme Court Denies MERS Legal Standing

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6 Responses to “Arkansas Supreme Court Denies MERS Legal Standing”
  1. Elaine S says:

    Simple logic: an agent represents a principle party. When a principle party is present and speaking for himself, the agent is superfluous and unnecessary for the principle to conduct his business. An agent is a helper,

  2. 1999 MERS Foreclosure Instructions for Arkansas

    I guess that this 1999 plan might not work for MERS?

    MERS Recommended Foreclosure Procedures for

    ARKANSAS

    Version 1.1, 11 November 1999

    Foreclosing a loan in the name of Mortgage Electronic Registration Systems, Inc. is something new in the foreclosure arena. However, when the role of MERS is examined, it becomes clear that MERS stands in the same position to foreclose as the servicer. MERS, like a servicer , will be the record mortgage holder. It is the mortgage or deed of trust that gives MERS the authority to foreclose.

    To help make a smooth transition from foreclosing loans in the name of the servicer to foreclosing loans in the name of MERS, we have developed state by state recommended guidelines to follow. These guidelines were developed in conjunction with experienced foreclosure counsel in your state. We have been able to keep the MERS recommended procedures consistent with the existing foreclosure procedures. The goal of the recommended procedures is to avoid adding any extra steps or incurring any additional taxes or costs by foreclosing in the name of MERS instead of the servicer.

    MERS will continually review the guidelines and, if necessary, will issue revisions. The recommended guidelines to follow in your state are as follows:

    Deeds of Trust are used and are generally foreclosed non-judicially under a power of sale in the security instrument. Local counsel advises that a foreclosure can be brought in the name of MERS. The Notice of Default is filed and published the same way it is when foreclosing in the name of the servicer except that Mortgage Electronic Registration Systems, Inc. (MERS) will be named as the foreclosing entity.

    Employees of the servicer will be certifying officers of MERS. This means they are authorized to sign any necessary documents, such as the Substitution of Trustee, as an officer of MERS. The certifying officer is granted this power by a corporate resolution of MERS. In other words, the same individual that signs the documents for the servicer will continue to sign the documents, but now as an officer of MERS. The substituted trustee is typically the foreclosing attorney.

    The agencies (Fannie Mae, Freddie Mac and Ginnie Mae) require a blank endorsement of the promissory note when the seller/servicer sells a mortgage loan to them. Therefore, the note should remain endorsed in blank when the foreclosure is commenced in the name of MERS.

    At the trustee sale, the certifying officer will instruct the trustee regarding the bid to be entered on behalf of MERS. The Trustee’s deed will be issued directly to the assignee of the bid. We have been advised that the current foreclosure procedure is a two-deed process with the servicer taking title and then executing a subsequent deed to the investor. Therefore, the MERS recommended procedure is the same as the current practice of assigning the bid to the servicer. Because the MERS recommended procedure follows the same procedure that is used when the servicer forecloses in its name, no additional taxes are incurred by foreclosing in the name of MERS.

    Evictions are handled the same way they are handled when the servicer commences the foreclosure as the foreclosing entity. If it is an FHA-insured loan and an eviction is necessary, then the servicer, by being the grantee of the trustee’s deed, can commence the eviction. This way, the servicer will proceed with the eviction the same way it would if the foreclosure were filed in its own name.

    If the debtor declares bankruptcy, the proof of claim should be filed jointly in the name of Mortgage Electronic Registration Systems, Inc. and the servicer. It is advised to file in both names in order to disclose to the court the relationship of MERS and the servicer. The address to be used is the servicer’s address so that all trustee payments go directly to the servicer. The Motion for Relief from Stay may be filed either solely in the name of MERS or jointly with the servicer. If MERS is the foreclosing entity, then it is MERS that needs the relief from the bankruptcy.

    • Attorney Wendy Alison Nora says:

      Excellent post. Here is the link to the MERS Foreclosure Manifesto of 1999 for every state. I recommend that the full version be downloaded in PDF format and saved. As MERS starts taking the full brunt of thousands of foreclosures being overturned, this document may disappear from the web. I have a copy of the version revised in 2001 also but it isn’t much different. This is the original MERS business plan which I call the MERS Foreclosure Manifesto. Can anyone doubt that the residential foreclosure crisis was pre-planned?
      [PDF]
      From the web today: MERS Recommended Foreclosure Procedures
      File Format: PDF/Adobe Acrobat – Quick View
      MERS has put together this Foreclosure Manual to provide a state by state …. are incurred by foreclosing in the name of MERS. Version 1.1. November 1999 …
      http://www.mersinc.org/filedownload.aspx?id=176&table=ProductFile

      • Attorney Wendy Alison Nora says:

        Sorry. This is the 2002 revision because that is what is available on the web now. Anyone who has the 1999 version would be generous to post the same. I have the original 1999 version but I do not know how to post it here. I hope the 2002 revision is helpful to all. It is still the MERS Foreclosure Manifesto and is shocking to see in its entirety. It promotes instructions for each bank using MERS how to foreclose in every state in a neat little package of 111 pages.

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