MERS Exits Foreclosure Business

MERS finalized its plans to exit the residential mortgage foreclosure business. Notably, and according to MERS, it is no longer handling Motions for Stay Relief or the filing of Proofs of Claim. The following is taken from MERS website:

Foreclosure and Bankruptcy

MERS System Membership Rule 8 prohibits Members from initiating foreclosure proceedings in the name of Mortgage Electronic Registration Systems, Inc. (MERS). Rule 8 provides the required guidelines that must be followed when a mortgage in which MERS is the mortgagee will be foreclosed.

Rule 8 requires a Member to instruct one of its MERS Signing Officers (also referred to as MERS Certifying Officers) to execute an assignment of the mortgage lien from MERS to the servicer or a third party selected by the Member. The assignment must be executed by the MERS Signing Officer prior to the initiation of the foreclosure proceeding. After executing the assignment, the Member must ensure that it is promptly sent for recording in the local land records as required by Rule 8.

These requirements also apply to Motions for Relief from Stay and Proofs of Claim in bankruptcy proceedings. Any time that a Member needs to file a Proof of Claim or Motion for Relief from Stay and MERS is the mortgagee, the Member must first instruct one of their MERS Signing Officers to execute an assignment of the mortgage lien from MERS to the servicer or a third party selected by the Member. As in foreclosure proceedings, the assignment must be executed prior to filing the document with the bankruptcy court, and the assignment should be promptly sent for recording.