In the late 1990s, without a single piece of enabling legislation, the Big Banks, infused with money, ego, hubris and a TBTF attitude, created MERS in order to electronically track securitized loans and avoid public recording fees. But like Dr. Frankenstein, the Big Banks never fully realized the monster they were about to create. The foreclosure crisis of the last five years has underscored the flawed logic of the MERS model.
In January 2013, the Oregon Supreme Court will, for the first time, hear oral argument on four certified questions dealing with MERS. It can only be hoped that after five years of litigation and millions of dollars in attorney fees, MERS will be quietly laid to rest in the Dustbin of Bad Ideas.
Herewith, in anticipation of the upcoming ceremony, I reprise an Ode to the star-crossed lovers most affected by the Mess MERS Made:
The Note and the Trust Deed had been married for years
The union was good, with very few tears.
They were always together, going hither and yon
But early one morning, the Trust Deed was gone.
Note searched for her lover, nearly out of her mind.
Soon her fears were confirmed – Trust Deed was assigned.
Unwilling to stop, she asked clerks far and wide
“Have you seen my dear Deed? He must be inside!”
But recorders responded, “Have you not heard of MERS?
We no longer record – we haven’t for years.”
“The best you can hope for,” friends told the Note
“Is to check with the Registry – it’s your last and best hope.”
Then she remembered, with rising alarm
Those 18 small numbers, tattooed on Deed’s arm.
So she rushed to the Registry, and entered the MIN
With hope against hope, she’d see Trust Deed again.
When MERS finally replied, a cold day in December,
She learned Deed was assigned – but not to a member!
“Oh, what shall I do,” the Note softly cried,
“MERS took my dear Deed, but left me outside.”
The months turned to years, then one day through fate,
She saw him by chance – her wayward soul mate.
Her Trust Deed looked terrible; he’d developed a paunch,
Seems he’d wasted away, in some low level traunche.
“Oh Trust Deed, my Trust Deed, return home to me.
Wherever I go, is where you must be.”
But Trust Deed responded, holding Note very tight,
“Dear, the law says once split, we can never unite.”
Now lawyers will argue, with logic askew,
That MERS didn’t cause the split of these two:
“They were just being strawmen – why can’t you all see?
MERS isn’t to blame – they’re just ‘Nominees.’”
But truth is the truth, it cannot be denied,
MERS is the reason, they’re not side-by-side.