Mortgages
First, let me define MERS….Mers is an innovative process that simplifies the way mortgage ownership and servicing rights are originated, sold and tracked. Created by the real estate finance industry, MERS eliminates the need to prepare and record assignments when trading residential and commercial mortgage loans.
NOW THAT WE HAVE DEFINED IT…LET’S UNDERSTAND THE UNDERLYING CONDITION THAT LED TO THIS PROCESS.
The mortgages that are written to this day, are sold to service providers (these are the banks that collect the payments) who ultimately sell them to other service providers. All this in the effort to make money on these sales. Finally, these loans are sold to Wall Street firms that package them and sell them as investments.
When homes sales began declining and some were worth half of the original price, many banks could not even locate the original loan in order to make modifications or to prove how much was owed in back payments. Paper, paper, everwhere and not a piece that was the right one.
MERS COMES IN….THIS IS AN ELECTRONIC SYSTEM OF TRACKING THE ORIGINAL MORTGAGE NO MATTER WHERE IT WINDS UP.
Until this system becomes the only way of doing mortgages, we will not get out of the lengthy foreclosures still waiting to be finalized. Once these mortgages are dealt with and either saved or completely foreclosed and back on the market for sale, the housing slump will hang around for a long time.
The U.S. government would have to make this a mandatory way of doing business for all l banks and mortgage lenders for this to be effective. Let’s hope this happens!
Just thought you should know.