Connect with us

Hi, what are you looking for?

The American GeniusThe American Genius

Economic News

Pennsylvania judge green lights case against MERS

zillow

MERS still the subject of many lawsuits

After a Texas judge dismissed a recent case against Mortgage Electronic Registration Systems Inc. (MERS), but the U.S. District Court for the Eastern District of Pennsylvania has now ruled that a class-action suit filed on behalf of Pennsylvania County recorders may move forward on the grounds that Pennsylvania law requires the recording of all conveyances of property.

According to court documents, allegations include not only the failure to record assignments, but engaged in civil conspiracy, unjust enrichment, and declaratory and injunctive relief. The court is allowing all allegations to move forward, and if won, MERS would be required to pay the registration fees but threw out the civil conspiracy claim.

A spokesperson for MERS said: “We will continue to defend this suit. We believe that we will prove that the MERS business model does comply with Pennsylvania law.”

Nancy Becker, the recorder of the deeds in Montgomery County, filed the lawsuit in 2011, claiming MERS helped financial firms and parties involved in mortgage securitization avoid payment on multiple mortgage assignments. The U.S. District Court opinion was that “the avoidance of recording fees both deprives her office and Montgomery County of revenue needed to support vital public functions.”

Advertisement. Scroll to continue reading.

Recording fees are being pursued by other states, but with laws differing in each jurisdiction, the outcomes will likely differ.

15 years of filing fees across the nation

MERS was initially established by Fannie Mae and Freddie Mac just over 15 years ago in conjunction with several major banks as a means to expedite the loan recording process as it used to be done through individual county clerk offices which was slow. “The founders went ahead even though no state laws authorized them to bypass the required filing with clerks,” according to Reuters.

Dallas County District Attorney Craig Watkins claims the establishment of MERS by banks was simply to avoid paying filing fees and claims that MERS “has all but collapsed this system throughout the U.S.”

Advertisement. Scroll to continue reading.

Tara Steele is the News Director at The American Genius, covering entrepreneur, real estate, technology news and everything in between. If you'd like to reach Tara with a question, comment, press release or hot news tip, simply click the link below.

Click to comment

Leave a Reply

Your email address will not be published.

The
American Genius
news neatly in your inbox

Subscribe to our mailing list for news sent straight to your email inbox.

Advertisement

KEEP READING!

Real Estate Technology

(TECH NEWS) It turns out that Internet of Things, like smart bulbs in homes, are not secure and give up your info - here...

Real Estate Marketing

(MARKETING) Your fancy, self-animating website might be making people violently ill, even if it is insanely beautiful. Sorry...

Real Estate Marketing

(MARKETING) Conduit is a CRM that does more than CRM, it analyzes your networking data to help you see how to improve your relationships.

Real Estate Corporate

(REAL ESTATE) Zillow has long been a data powerhouse, but a lawsuit about a $150M listing offers a look into listings claims.

The American Genius is a strong news voice in the entrepreneur and tech world, offering meaningful, concise insight into emerging technologies, the digital economy, best practices, and a shifting business culture. We refuse to publish fluff, and our readers rely on us for inspiring action. Copyright © 2005-2022, The American Genius, LLC.