SELLOUT TO MERS MEMBERS — AMNESTY!?: FANNIE MAE ISSUES NEW GUIDELINES ON RECORDING ASSIGNMENTS

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EDITOR’S NOTE: It appears as though Fannie Mae is trying to give some wiggle room to banks and servicers under the guise of new guidelines. But State law prevails and the guidelines are only effective as a matter of contract between FANNIE and correspondent lenders. One thing is clear, FANNIE is trying to legitimize MERS. It requires the following:

1. the lender must report the MERS registration when it delivers the mortgage to us (by entering the applicable MIN on the Loan Schedule or Schedule of Mortgages). After we purchase or securitize the mortgage, we will notify MERS to ensure that the MERS records are updated to reflect our ownership interest. [Editor’s Note: This is a quasi government agency that was nationalized. MERS is a private recording system that is essentially unsecured — any person gaining a password and user ID can use it indefinitely to change the records. FANNIE should be eliminating MERS not including it in its operations. This is an attempt to say that MERS is a legitimate operation and that FANNIE will continue using it. It gives the impression that what they are doing it right, when in fact it is contributing to the title mess that is growing into nightmarish proportions throughout the United States]
2. the lender will need to report our ownership interest to MERS when it registers the mortgage [Editor’s Note: This is a tricky way of leaving it to the correspondent lender to determine if the transfer to FANNIE has made proper and complete. It will be used by Banks to say that the administrative rules create a presumption of validity when in fact the requirements of state law either have not been met or it will be used to block borrower’s attempts to find out if State law has been followed. Once again attention to diverted from the discrepancies between (a) what they did at closing with the borrower (b) what they said they would do for the investor and (c) what they actually did with the money.
3. After we purchase or securitize the mortgage, we will notify MERS to ensure that the MERS records are updated to reflect our ownership interest [Editor’s Note: This is doubletalk. If they purchase the mortgage, which they virtually never do except in cases of default, then they are the owner if they get a complete chain of title and properly executed documents by properly authorized people. If they securitized the mortgage, which is nearly always the case then they don’t own it. Why would they report to anyone, much less MERS that they own the loan? Once again attention to diverted from the discrepancies between (a) what they did at closing with the borrower (b) what they said they would do for the investor and (c) what they actually did with the money.
4. For mortgages in existing Fannie Mae servicing portfolios, the lender will need to report our ownership interest to MERS when it registers the mortgage. (Note: If the original assignment of the mortgage to Fannie Mae was recorded in the public records, the servicer will first need to prepare an assignment from Fannie Mae to MERS and send it to us for execution. [Editor’s Note: THEY ARE DOING IT AGAIN! ASSIGNING INTERESTS TO MERS WHEN MERS EXPRESSLY DISCLAIMS ANY INTEREST IN THE NOTE OR MORTGAGE BY CONTRACT AND BY ADVERTISEMENT.]
5. MERS will promptly notify us when a lender reports that we have an ownership interest in mortgages that it is registering with MERS. [THEY ARE DOING IT AGAIN. Leaving it to banks, servicers and MERS to sort out ownership of the loan without regard to the financial realities of the loan — whether payments have been made by obligors other than the borrower on the promissory note, whether the loan has been paid off in whole or in part by the servicer, insurer, credit enhancement or Federal bailout.]
6. The lender will not need to include in the delivery package for a MERS-registered mortgage a copy of the assignment of the mortgage to MERS, nor will the lender be required to prepare and submit an unrecorded assignment of the mortgage to Fannie Mae, unless we specify otherwise for a particular transaction or transactions. [This is a blatant sellout to the Banks and servicers. It basically says that FANNIE will regard the package as in proper form and authentically transferred if the mortgage is MERS-registered. That is nuts. It means that they are formalizing the institutionalization of uncertainty in the marketplace. If this is allowed. Nobody will know the true owner of the loan from any public record, and therefore no owner and no lender will ever know if they really have a priority interest in the property. State statutes do not, in any case, allow MERS to pre-empt the county recording system. Yet that is exactly what FANNIE is attempting to do here.
7. If a loan is registered with MERS and the servicing of the mortgage is subsequently transferred to another lender that is a MERS member, the transferee will not need to prepare an unrecorded assignment of the MERS-registered mortgage as part of the custody documents unless we specify otherwise for a particular transaction or transactions.
8. if servicing of a MERS-registered mortgage is transferred to a lender that is not a member of MERS, or if the MERS registration for an active mortgage is terminated for any reason, an assignment from the servicer to Fannie Mae in recordable form but unrecorded will be required. [THUS A MERS MEMBER IS ELEVATED TO A POSITION HIGHER THAN THE NORMAL PERSON WHO MUST FOLLOW STATE LAW. MERS MEMBERS, ACCORDING TO FANNIE, DO NOT NEED OT FOLLOW THE LAW.]

https://www.efanniemae.com/sf/guides/ssg/relatedsellinginfo/mers/pdf/merspolicy.pdf

Federal Home Mortgage dba FANNIE MAE (FORCE UPON ‘COMMERCE’ UTILIZING ‘MIN#’ ASSIGNMENT PRIOR TO SECURITIZATION.

Rules and Instructons to Correspondent Lenders

– For new mortgage deliveries to Fannie Mae, the lender must report the MERS registration when it delivers the mortgage to us (by entering the applicable MIN on the Loan Schedule or Schedule of Mortgages). After we purchase or securitize the mortgage, we will notify MERS to ensure that the MERS records are updated to reflect our ownership interest. (PLEASE NOTE THAT IT IS IMPORTANT TO REGISTER THE MIN ON THE MERS SYSTEM PRIOR TO DELIVERY OF THE LOAN (AND THE ASSOCIATED MIN) TO FANNIE MAE.)

-For mortgages in existing Fannie Mae servicing portfolios, the lender will need to report our ownership interest to MERS when it registers the mortgage. (Note: If the original assignment of the mortgage to Fannie Mae was recorded in the public records, the servicer will first need to prepare an assignment from Fannie Mae to MERS and send it to us for execution.) MERS will promptly notify us when a lender reports that we have an ownership interest in mortgages that it is registering with MERS.

• The lender will not need to include in the delivery package for a MERS-registered mortgage a copy of the assignment of the mortgage to MERS, nor will the lender be required to prepare and submit an unrecorded assignment of the mortgage to Fannie Mae, unless we specify otherwise for a particular transaction or transactions.

• If a loan is registered with MERS and the servicing of the mortgage is subsequently transferred to another lender that is a MERS member, the transferee will not need to prepare an unrecorded assignment of the MERS-registered mortgage as part of the custody documents unless we specify otherwise for a particular transaction or transactions. However, if servicing of a MERS-registered mortgage is transferred to a lender that is not a member of MERS, or if the MERS registration for an active mortgage is terminated for any reason, an assignment from the servicer to Fannie Mae in recordable form but unrecorded will be required.

• The lender will be responsible for the accurate and timely preparation and recordation of security instruments, assignments, lien releases, and other documents relating to MERS-registered mortgages and must take all reasonable steps to ensure that information on MERS is updated and accurate at all times. The lender will also be solely responsible for any failure to comply with the provisions of the MERS Member Agreement, Rules, and procedures and for any liability that it or Fannie Mae incurs as a result of the registration of mortgages with MERS or any specific MERS transaction.

Fannie Mae Guides and with the terms and conditions of the lender’s Master Agreement or any negotiated contract that it has with us, unless we specify otherwise. In addition, MERS’ failure to perform any obligation with respect to a MERS- registered mortgage does not relieve the lender (or the mortgage servicer) from its responsibility for performing any obligation required by the terms of its Fannie Mae contracts or the provisions of the Fannie Mae Guides.

For more information, please visit the AllRegs® website (http://www.allregs.com/efnma/) and perform a search under Fannie Mae Single Family for MERS.
MORNET is a registered trademark of Fannie Mae. MERS is a registered trademark of Mortgage Electronic Registrations Systems, Inc. and AllRegs is a registered trademark of Mortgage Resource Center Corporation.

Tags: assignments, bankruptcy, borrower, countrywide, disclosure, Fannie, foreclosure, foreclosure defense, foreclosure offense, foreclosures, fraud, LOAN MODIFICATION, modification, quiet title, recording, rescission, RESPA, securitization, TILA audit, trustee, WEISBAND
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