Written by V   

One of the things which defines this country is the concept of private property ownership. Land, what is on it, and what you do with it, is the basis of all the wealth created in this country. Consequently, who owns the land is of great interest to all.

Because of this, state governments have established recording laws and statutes which govern how ownership is recorded. It is set up so an interested third party can come in and by researching titles, determine who owns the land, who owns the resources on that land and if the land has been encumbered with debt. The accuracy of that information is paramount. It must be public, it must be accessible to all. To give you an example of how important it is to have this information public, let me give a real life example.

I used to be a logging contractor in the wilds of North Idaho. I would often meet with landowners out on the ground to talk to them about their property, their desires and goals for the land and the resources which were on it. If we came to an understanding, the landowner would hire me to harvest some or all of his timber, sell it to the mill, extract my fee and hand over the remains.

The first thing I would do once I had the contract in my hand would be to go to the county courthouse and research the title to establish two things. The first thing was, does this person really own the land? Usually, they did. Occasionally, they didn’t and I would have to tell them thank you very much, but unless I were dealing with the true owner, I couldn’t harvest their timber.

The second thing I would establish was does this person actually have the rights to sell the timber? Landowners sometimes sell a timber deed which transfers the ownership of the timber to another person. It gives that person the rights to harvest the timber with certain restrictions. Those restrictions could be diameter or a certain volume and would usually include a time limitation.

Only after I had established my client actually owned the land and the rights to the timber did I finally get around to looking at the recorded surveys to determine the meets and bounds of the property. Using that information, I could establish harvest boundaries by chaining in from a survey monument or, if there were enough hard points, by using a string box and a compass.

I was the interested third party. If I didn’t do it and I were wrong, I was on the hook for triple stumpage. That can mount up rather quickly. There were times I would spend hours in the recorder’s office searching out titles, sometimes all the way back to the original land grants. You can see how accurate, public information was critical for my economic well being.

Enter MERS, a private corporation set up by Fannie, Freddie, Ginnie, the Mortgage Bankers Association and a whole host of title companies who, in an attempt to save their customers money, created a private database of ownership hidden from public view. MERS is supposed to keep track of assignments but they do so behind a cloak of secrecy. They demand parity, if not primacy over data which is publicly available at the county courthouse.

Data is a funny thing. It must be kept current or it deteriorates in quality and eventually becomes useless. MERS has supplanted data at the county courthouse for 13 years now and the public data is deteriorating. Suddenly, a third interested party is no longer able to go to the county courthouse and determine ownership or encumberances upon that ownership. Now the third party is faced with a dilemma of not being able to rely on public data for correct information.

Here is a real world example of just what sort of chaos this duality of databases can cause. In 2000, Ross Jahren bought a piece of property in Florida. A couple of years later he sold it to New Millennial Corp. A title search on the property turned up evidence of two mortgages from AmSouth Bank but a check with AmSouth indicated a $0.00 balance on both the mortgages. The title attorney, relying on the information from the county courthouse and AmSouth, approved the deal and it closed.

A couple of months later, JP Morgan came wading into the picture waving an unrecorded assignment demanding payment and threatening foreclosure. The matter was taken to court and immediately dismissed because JP Morgan had an “unrecorded assignment”. JP Morgan appealed the matter and the appeals court overturned the lower court’s ruling declaring that the recordation laws have nothing to do with foreclosure defense, but instead indicate the pecking order in the event of foreclosure. So the case went back to the lower court giving JP Morgan the right to foreclose but left them in a position to recover nothing because they did not have a recorded assignment.

Do you begin to see the problem here?

It’s not supposed to work this way. It turns 400 years of American jurisprudence on its head. And why? Well, publically, so MERS can save their member banks billions of dollars in recording fees. But here’s the tick. When you create a private database the way MERS has, it opens the door to fraud. MERS is what enabled Wall St. to engage in the wholesale rape of the mortgage market. There are indications of multiple assignments to multiple parties at the same time all behind the cloak of MERS. It can’t be proven because ... well ... because the database is private and a third interested party isn’t allowed to examine it.

If you have MERS on your mortgage, there is no telling what has happened to it. Your mortgage may have been slammed into 5, 10, 15 different trusts and you would never know it. When the payments didn’t arrive, the banks collected on the insurance but never foreclosed on you because it all happened behind the cloak of MERS. Remember, the term is Credit DEFAULT Swaps. Not Credit FORECLOSURE Swaps. The Wizards of Wall St. created trusts out of false assignments using your mortgage, bet on them, collected the insurance, then closed them out, all within the confines of the very private MERS database. And you never knew.

And think on this, do you really think you are safe from one of these unrecorded assignees showing up randomly and foreclosing on your home? Have you ever seen stories of homeowners who were foreclosed upon by banks even though they are current on their mortgage? Or paid off? By some complete stranger? “Oops, my bad” they say, to which I reply, “Yeah, right.” Not the way I want to spend my golden years, how about you?

So, I have a question for you. Now that you know, what are you going to do about it?