The serious problems with the MERS system are well-known to millions of homeowners. Finally, popular media has started to report on the appalling condition of MERS property recording in the U.S.
In the past, mortgages and mortgage assignments were recorded in county offices, making them relatively easy to access. MERS—the Mortgage Electronic Registration System—was created by the mortgage industry so banks could buy, sell and trade loans among themselves without having to pay a county filing fee, or create a public record.
Now most mortgages and assignments are recorded “in private” by MERS.
The problem: MERS has often failed to track loans that were securitized or traded between banks. It is estimated that more than 4 million homeowners faced foreclosure proceedings based on errors or inaccurate information.
Most families who were illegally foreclosed on are being compensated by banks on an admittedly arbitrary basis that yields each homeowner $300-$2000.