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…