Most Americans have never heard of it, but this mortgage industry holds interests in 50 percent of all U.S. home loans.
No, not Fannie Mae, or Freddie Mac either.
Mortgage Electronic Registration Systems, otherwise known as MERS, is a private firm that tracks ownership in hundreds of thousands of home loans. The computerized network allows banks to buy and sell mortgages without having to record the transfers at the county level.
An added bonus for the banks is the avoidance of county fees. When MERS is used to turn a regular mortgage into an investment, financial institutions don’t pay “recording fees,” which are usually small charges of between $50 and $100, to the counties where the underlying properties are physically located.
This has some county clerks upset.
“The average Joe who comes into my building, hard working people, have to pay the fees,” said John O’Brien, register of deeds in Southern Essex, Massachusetts.
“Why in God’s name can’t banks and Wall Street lenders do the same thing? Play by the same rules!”
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