November 9, 2010
In what can only be described as one of the most arrogant hypocracies in foreclosure litigation, MERS’ own “Terms and Conditions” with its lenders and servicers, which was recently produced to us in court-ordered discovery, expressly states that the MERS system is not to be used to create or transfer interests in mortgage loans. The MERS contract goes on to state that MERS is never to be identified as the owner of the promissory Note in any foreclosure proceedings, and that MERS will monetarily fine any offenders who do so.
Notwithstanding these self-imposed limitations, MERS has and continues to act as the purported “assignor” to assign mortgages AND PROMISSORY NOTES to foreclosing parties in both judicial and non-judicial foreclosures, affirmatively representing that it is assigning the Mortgage (or Deed of Trust) “together with the Note or other indebtedness”. The overwhelming case law from the state, Federal, and Bankruptcy Courts throughout the United States which have dissected the MERS claim have come to the same universal conclusion, which MERS’ own counsel recently admitted on the record in one of our cases: that MERS does not own promissory notes, thus it cannot transfer them.
How, then, does MERS attempt to assign a Mortgage or Deed of Trust “together with the Note”? It lies, pure and simple, and hopes that the unsuspecting borrower does not catch it. Remember, MERS told the Supreme Court of Nebraska, through its attorney, that MERS does not loan money, does not own mortgage loans, does not extend credit, etc., so that MERS would not have to register as a mortgage lender and could thus avoid paying fees. However and despite these representations to a state supreme court by its own attorney, MERS goes to all of the other 49 states and says the exact opposite in the various “assignments”: by claiming ability to assign the Note, it is both creating an interest in the Note which it never had and is also transferring an interest in a mortgage loan, both of which MERS’ own Terms and Conditions say MERS cannot do.
To add insult to injury, MERS also, as the purported “beneficiary” of the Deed of Trust, also attempts to substitute the Trustee to further a foreclosure in the non-judicial states. As the case law has overwhelmingly stated (including the recent Federal decisions in California and Oregon and the prior decisions from Nevada and other states), MERS is NOT a “beneficiary” despite claiming to be so in Deeds of Trust, as the “beneficiary” is the party for whose benefit the Deed of Trust is given, that being the lender. An Oregon Federal case recently analyzed the statutory definition of “beneficiary” under the Oregon Trust Deed Act and concluded that MERS is not the “beneficiary” despite claiming to be so.
So the MERS hypocracy rolls on. It is up to us who actually read and understand the case law and go around the country teaching this to the Courts to continue to do so, especially with attorneys for “lenders”, “servicers”, and trustee banks continuing to chant their one-themed mantra: “the Deed of Trust says MERS is the beneficiary; therefore it is so”. We applaud those Courts who have analyzed the MERS facade and have said it is not so.
Jeff Barnes, Esq., www/ForeclosureDefenseNationwide.com