Roughly half of the mortgages owned or guaranteed by Fannie Mae are registered in the Mortgage Electronic Registration Systems name, according to a filing by the government-sponsored enterprise last week.
Fannie's guaranty book of business totaled $2.9 trillion at the end of the first quarter, meaning about $1.45 trillion of loans are registered in MERS' name. The connection, Fannie said, poses a significant risk.
Privately held MERS, which was built by the GSEs and the nation's major lenders in the 1990s, is an electronic registry that tracks servicing rights and ownership of loans from origination through securitization. MERS serves as a nominee for the owner of a mortgage and therefore becomes the mortgagee of record for the loan in local land records.
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