Order | Washington Supreme Court to Weigh Legality of MERS Foreclosures

Washington Supreme Court to weigh legality of MERS foreclosures

Washington state’s highest court is set to determine whether thousands of pending foreclosures can proceed out of court, potentially averting months of conflicting and murky rulings.

The court will hear arguments over whether lenders can file foreclosures in the name of MERS, a private company that owns a computerized mortgage registry system. Big lenders, including Fannie Mae, Freddie Mac and several large U.S. banks, created MERS in 1995 to get around cumbersome laws that required paperwork to be filed with county clerks when a mortgage changed hands.

But in the midst of a foreclosure crisis, the company is facing investigations over whether it can legally initiate foreclosure proceedings.

If the court rules against MERS, it could force thousands of foreclosures into court that would otherwise have been handled without ever going before a judge.

And any decision could bring some order to a hodgepodge of state and federal rulings in wrongful foreclosure complaints — at least, in Washington. Elsewhere, including Oregon, similar cases continue their long slog toward Supreme Court resolution, a legislative fix or a different tack by lenders.

At issue is whether MERS meets the definition of a beneficiary under Washington law, and therefore whether it can legally file a foreclosure on a lender’s behalf.

Check out the rest here…

Order Certifying MERS Questions below…




7 Responses to “Order | Washington Supreme Court to Weigh Legality of MERS Foreclosures”
  1. Ron Moss says:

    In Nebraska v MERS Mers had to prove it was not qualified as a lenderto avoid a state tax if it was. They were convincing and won. Consequently they cannot qualify as a lender so cannot be legal to foreclose without
    breaking the chain of Title, or at least weakening it a little.

  2. talktotennessee says:

    The Nebraska Supreme Court decision states the following in their ruling that MERS is not a Mortgage Bank:
    “But, simply stated, MERS has no independent right to collect on any debt because MERS itself has not extended credit, and none of the mortgage debtors owe MERS any money.”

    It appears that had the Court decided MERS is a Mortgage Bank, MERS would have legal standing to collect debt but since they are merely a registry or nominee trustee for “a” lender, they have no right to collect something they did not lend nor was ever owed them. MERS made no loans and debtors don’t owe MERS. Therefore, it would seem MERS has no legal standing either to initiate foreclosure in judicial states or to file for relief of stay in bankruptcy actions in those states. It would appear the actual owner of the debt would have to take the action to foreclose, or file for relief of stay based on the court’s line of thinking.

    The flip side of the coin in that position: If MERS has no standing for these actions because they are not owed money, it seems grossly unjust to allow MERS foreclose rights in non-judicial states because MERS assumed nominee status at closing, a position not fully transparent to the borrower. Another little ditty to add to good faith estimates, FDPA. RESPA, etc.

    I would think if the courts continue to allow MERS to act in this lopsided manner, the U.S. Supreme Court may need to rule on their legal standing although that might not bode well either, if you know what I mean. Standardization across state lines in HUD/FHA lending requirements, banking regulations or FDPA compliance seems consistent. Then why is MERS allowed to continue taking unfair advantage nationally, even globally in this one sided farce that conceals banking fraud and forgery for states without judicial access?

  3. The foreclosure dilemma in Washington requires judicial determination of two issues. The article indicates that the Supreme Court of Washington State will only address one of these. The Court has agreed to decide whether the plaintiff in a foreclosure proceeding must have a beneficial interest. The second question is whether a mortgage which consisting of a promissory note naming the originating bank as mortgagee and a mortgage agreement naming MERS as mortgagee is enforceable. Conceptually, the mortgage agreement is a security agreement which gives a right of foreclosure to the mortgagee to secure repayment of a debt owed by the mortgagor to the mortgagee. In the case of a split note, the debtor never agreed to repay MERS; MERS did not make the loan; and the originating creditor named in the promissory note is not a party to the mortgage agreement.
    In non-judicial jurisdiction, a third party, the trustee, is given the right to foreclose on behalf of the mortgagee. MERS is not named as the trustee but instead is named as the mortgagee. MERS tries to act with some of the powers of a trustee without appointment in the mortgage as trustee and without a delegation of authority to foreclose.
    In addition, too comply with REMIC requirements for a pass through mortgage, the accountants and lawyers who established mortgage backed securities trusts (MBSTs) created a wealth of opinions that MERS had no beneficial interest in the MBST or its mortgages.

  4. Ron Moss says:

    Has the Washington Supreme Court set a date for hearing the MERS deal yet?

  5. talktotennessee says:

    MERS is alive and well foreclosing in non-judicial states like TN where they do not have to go before a judge to confirm their legality. See (small sample) of hundreds of listings below from TN. Many are handled through Arkansas-based Wilson and Associates, who continues to foreclose naming MERS as nominees all lenders and even B of A and Countrywide Bank, Southwest, Creative Mortgages or others who are operating under different ‘handlers.’ Identifying information was removed as the information was obtained from subscription sources, an entity of RealtyTrac. These foreclosures are samples of thousands foreclosing in Memphis by various servicer banks without regard of forged or fraud documentation. Foreclosure is initiated by the servicer through Wilson and others who handle FDPA requirements from that point forward, foreclosing through MERS as trustee and beneficiary. It is a massive misrepresentation of justice.

    We should consider petitioning through all available resources. President Obama is preparing to roll out a website allowing petitions directly to his website, which may be to determine hot issues needed before election but we can use any avenue! Think of it as creating a passive protest against what is going down nationwide now! Also if you know of other petitioning facilitators like CREDO, Company Men, Crime doesn’t pay, etc. etc facebook, suggest petitions to raise awareness of efforts to expose the shell game of banks hiding under MERS like bugs under a rock.
    Collectively we have power!
    Regardless of your political affiliation, politicians respond to petitions and polls. We need to petition the President and others to seek a moratorium on all foreclosures to expose MERS’ sham.. Even though each state has unique property laws and foreclosure methods, collective rights of homeowners are being circumvented by lenders through a shell entity, MERS, who has no legal obligation or ownership outside banks who hide behind this sham data registry. This is not just a state’s rights issue! MERS is operating nationwide with banks/lenders using this dodge through national and international companies operating across all state borders.
    Think about it people, Michael and/or others?
    Can we begin a petition?

    Shelby County-Memphis
    Panama Street,
    Sale Date: 9/9/2011 Owner:
    Sale Time: 12:00PM Lender: Mers As Nominee For Countrywide Bank, F.S.B.
    Location: Courthouse Contact: Wilson & Associates, P.L.L.C.
    Status: Active

    Shelby County-Bartlett
    Diplomat Place, 38134
    Sale Date: 9/16/2011 Owner:
    Sale Time: 12:00PM Lender: Mortgage Electronic Registration System Inc As Nominee For M&T Bank
    Location: Courthouse Contact: Wilson & Associates, P.L.L.C.
    Orig Prin Bal: $171,000.00
    Status: Active

    Shelby County-Memphis
    Tut Cove, 38128
    Sale Date: 9/16/2011 Owner:
    Sale Time: 12:00PM Lender: Mortgage Electronic Registration Systems, Inc. As Nominee For First Magnus Financial Corporation, An
    Location: Courthouse Contact: Wilson & Associates, P.L.L.C.
    Orig Prin Bal: $93,900.00
    Status: Active

    Shelby County-Memphis
    Hobson Cove, 38128
    Sale Date: 9/16/2011 Owner:
    Sale Time: 12:00PM Lender: Mortgage Electronic Registration Systems, Inc., As Nominee For American Home Mortgage
    Location: Courthouse Contact: Wilson & Associates, P.L.L.C.
    Orig Prin Bal: $57,750.00

    Status: Active
    Shelby County-Memphis
    North Holmes Street,
    Sale Date: 9/16/2011 Owner:
    Sale Time: 12:00PM Lender: Mortgage Electronic Registration System, Inc As Nominee For Creative Mortgage Services, Inc. And Cre
    Status: Active

    Shelby County-Memphis
    Dillworth Street,
    Sale Date: 9/16/2011 Owner:
    Sale Time: 12:00PM Lender: Mortgage Electronic Registration Systems, Inc., As A Separate Corporation That Is Acting Solely As A
    Location: Courthouse Contact: Wilson & Associates, P.L.L.C.
    Status: Active

    Shelby County-Memphis
    Kallaher Avenue, Sale Date: 9/23/2011 Owner:
    Sale Time: 12:00PM Lender: Mortgage Electronic Registraton Systems, Inc As Nominne For Countrywide Home Loans, Inc.
    Status: Active

  6. Stupendous Man - Defender of Liberty, Foe of Tyranny says:

    Anyone seeking to understand MERS would benefit by reading the Appellant’s Brief in the case of MERS v. Nebraska Department of Banking. Available on scribd:


    The Nebraska Supreme Court opinion is found here:


  7. Jim Bethea says:

    This should be a no brainer for the courts ~~ there have been many many court rulings against MERS having any lawful standing ~ I thought MERS had issued a statement that they would no longer be listed as a Plaintiff Party in anymore foreclosure actions?????

Leave a Reply