Beau Biden, state attorney general (AG) of Delaware, has filed suit against the Mortgage Electronic Registration System (MERS) for deceptive trade practices. Saying that “real property rights have been a cornerstone of our society,” Biden alleges that MERS’ has created “confusion among homeowners, investors and other stakeholders in the mortgage finance system, seriously damaging the integrity of the land records that are central to Delaware’s real property system and leading to improper foreclosure practices.”
Bidens suit cites an example of a recent New Castle County foreclosure in which MERS foreclosed on a loan “in which it had no interest and…the entity upon whose behalf MERS sought to foreclose had actually been dissolved months prior.” Biden alleges that MERS not only deliberately hid the true mortgage owner from the public record but used its massive database to deliberately create “confusion and inappropriate assignments and foreclosures of mortgages.”
Not surprisingly, MERS spokeswoman Janis Smith insists that the AG’s allegations have “no merit.” She added that “there is no confusion” and that MERS has “transparent” business practices, pointing out that the corporation has acted “in good faith” with Biden and that the lawsuit was unexpected.
New York AG Eric Schneiderman has also subpoenaed MERS for information, and Dallas County, Texas district attorney Craig Watkins has sued the corporation as well. Watkins believes that his county may be owed “as much as $100 million” for wrongful foreclosures by various entities, including MERS and Bank of America.
Should MERS be disbanded? What do you think about Biden’s lawsuit?
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