John O’Brien, the Salem based register for deeds in Southern Essex County, said in the letter to Coakley that it had come to his attention that a number of states have alleged in court filings that MERS intentionally failed to pay recording fees, and failed to disclose the transfer and assignments of interest in property, solely to avoid and decrease the recordation fees owed to the counties and the state.
Perhaps more seriously, MERS may have wrongfully bypassed strict Massachusetts recording requirements. Unlike some states which allow for opt-outs or voluntary recordation, the Massachusetts recording requirements are mandatory.
Coakley has a reputation as a strong advocate for consumers, which could pre-dispose her to look disfavorably on MERS.
MERS is taking the charge seriously enough to respond. It denies any wrong-doing and promises to “fully cooperate with any inquiries from proper authorities.”
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MERS also lays out its theory of why it doesn’t need to pay new recording taxes when mortgages are passed between members. The basic idea is that MERS becomes the mortgage owner, holding legal title to the mortgage lien. What’s more, MERS argues that transfers of mortgage notes are not recordable events—only the lien transfer is a conveyance.
Read on.
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